Falling crude prices show a dead cat bounce at $50/barrel, warning of further selling pressure. OPEC production cuts have not helped much as the market anticipates slowing demand from China.
The Dollar Index is strengthening, with Trend Index troughs above zero signaling buying pressure. Follow-through above 97.50 would signal an advance to 100 in the medium-term (next quarter).
Gold rallied to test resistance at $1250/ounce but this is still a bear rally and another test of support at $1180 is likely. Breach would warn of a decline to the 2015 low at $1050/ounce.
The All Ordinaries Gold Index ran into strong resistance at 5100. Declining Trend Index peaks warn of selling pressure. Breach of 4900 would warn of another test of 4550.
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.