Brent Crude is drifting lower but so far has not seriously tested medium-term support at $115/barrel. Respect would confirm the primary up-trend, offering a target of $135*. Respect of the zero line by 63-day Twiggs Momentum would also strengthen the signal.
* Target calculation: 125 + ( 125 – 115 ) = 135
The broader CRB Commodities Index is headed for a test of primary support at 295. Respect of zero (from below) by 63-Day Twiggs Momentum indicates continuation of the primary down-trend. Breach of primary support would confirm the signal.
* Target calculation: 295 – ( 325 – 295 ) = 265
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.
Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.
You might want to identify the chart patterns. Does the chart pattern on Brent looks like a double top to you? If the Canadian$ is suppose to be the “Petro $”, do you see any correlations?
If the CRB goes down, how does it correlate with the stock market?
Q. Does the chart pattern on Brent looks like a double top to you?
A. No. Not unless it breaks support at 100.
Q. If the Canadian$ is suppose to be the “Petro $”, do you see any correlations?
A. CAD has weakened against AUD over past few years, but Nymex Light Crude is now appreciating against CRB. CAD is likely to follow against the AUD.
Q. If the CRB goes down, how does it correlate with the stock market?
A. CRB correlates well with the $SPX — except at tops and bottoms. So what does the current divergence tell us?
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