Colin Twiggs, Author at the patient investor

May 31, 2012

Clarke and Dawe – Australian Political Scientist

An irreverent look at Australian politics.

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.

May 31, 2012

Bair: Regulators Should Tighten Volcker Rule – WSJ.com

Jamila Trindle: Regulators should push derivatives out of federally backed banks and tighten the Volcker rule, former Federal Deposit Insurance Corp. Chairman Sheila Bair said Thursday.

“Don’t let insured deposits fund that activity,” Ms. Bair said at a roundtable on the Volcker rule held by staff of the Commodity Futures Trading Commission.

via Bair: Regulators Should Tighten Volcker Rule – WSJ.com.

Colin Twiggs

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.

May 31, 2012

Forex: Australia and Canada

Falling crude oil and commodity prices are likely to depress resource-rich currencies. Canada’s Loonie found support at $0.97 but 63-Day Twiggs Momentum below zero warns of a primary down-trend. Failure of $0.97 is likely and would test the primary level at $0.94/0.95.

Canadian Dollar

* Target calculation: 0.95 – ( 1.01 – 0.95 ) = 0.89

The Aussie Dollar is testing primary support at $0.96/0.97. Declining 63-day Twiggs Momentum (below zero) warns of a primary down-trend. Failure of support at $0.96 would offer a long-term target of $0.84*.

Aussie Dollar

* Target calculation: 0.96 – ( 1.08 – 0.96 ) = 0.84

Colin Twiggs

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.

May 31, 2012

Forex: UK and Europe

The Euro broke primary support at $1.26 against the greenback. A peak below zero on 63-day Twiggs Momentum indicates continuation of the primary down-trend. Expect a test of the 2010 low at $1.19/$1.20.

Euro/USD

* Target calculation: 1.26 – ( 1.35 – 1.26 ) = 1.17

Pound Sterling is consolidating between €1.2350 and €1.2600 against the euro. Reversal below the lower trend channel would warn of a correction, while breakout above €1.2600 would signal continuation of the primary advance. Completion of a bearish divergence on 63-Day Twiggs Momentum would strengthen a bear signal.

Pound sterling/Euro

Colin Twiggs

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.

May 31, 2012

Commodities lead stocks lower

The CRB Commodities index is headed for a test of the 2010 low of 250. A 63-day Twiggs Momentum peak below zero warns of a strong primary down-trend. Divergence from the S&P 500 index warns that stocks are likely to fall, following commodities down — at least to their 2011 lows.

CRB Commodities Index

* Target calculation: 290 – ( 330 – 290 ) = 250

Colin Twiggs

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.

May 31, 2012

Crude: Brent and WTI Light

Brent Crude is headed for a test of primary support at $100/barrel. Failure would indicate a long-term decline to $75/barrel*. 63-Day Twiggs Momentum below zero already warns of a primary down-trend.

ICE Brent Afternoon Markers

* Target calculation: 100 – ( 125 – 100 ) = 75

Nymex WTI Crude below $90/barrel, signals a primary down-trend. 63-Day Twiggs Momentum below zero strengthens the signal. Expect a test of the 2011 low at $75/barrel — similar to Brent Crude.

Nymex WTI Light Crude

* Target calculation: 92 – ( 110 – 92 ) = 76

Colin Twiggs

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.

May 31, 2012

Spot gold tests $1530

The Dollar Index followed through after last week’s breakout above resistance at 81.50/82.00, confirming the fresh advance signaled by a 63-day Twiggs Momentum trough above zero. Target for the advance is 86.00*.

US Dollar Index

* Target calculation: 82 + ( 82 – 78 ) = 86

On the daily chart, spot gold tests medium-term support at $1530/ounce. Long tails indicate buying support but the rising dollar continues to apply downward pressure. Breach of support and follow-through below $1500 would signal a long-term decline to $1200/ounce*. Declining 63-day Twiggs Momentum (below zero) already indicates a primary down-trend. Recovery above $1600 is less likely but would indicate that the down-trend is weakening.

Spot Gold

* Target calculation: 1500 – ( 1800 – 1500 ) = 1200

Colin Twiggs

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.

May 31, 2012

Treasury yields fall as investors flee stocks

Treasury yields fell through the key support level of 1.70 percent as investors, seeking a safe haven, flowed into bonds. Declining 63-day Twiggs Momentum warns of further easing.

10-Year US Treasury Yields

* Target calculation: 1.70 – ( 2.40 – 1.70 ) = 1.0

Colin Twiggs

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.

May 31, 2012

Australia: ASX 200 breaks triangle

The monthly chart of the ASX 200 displays a downward breakout from the ascending triangle, forming since September 2011, offering a target of the 2008 low at 3200*. Reversal of 63-Day Twiggs Momentum below zero also suggests continuation of the primary down-trend.

ASX 200 Index

* Target calculation: 3800 – ( 4400 – 3800 ) = 3200

Colin Twiggs

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.

May 31, 2012

India & Singapore

The BSE Sensex found medium-term support at 16000/15800 but reversal of 13-week Twiggs Money Flow below zero warns of further selling pressure. Expect another test of primary support at 15000/15200. Failure would offer a target of 12000*.

BSE Sensex Index

* Target calculation: 15 – ( 18 − 15 ) = 12

With almost half of foreign bank funding sourced from Europe, India is experiencing significant tightening of external finance and hence domestic investment.

Singapore’s Straits Times Index is testing medium-term support at 2750. Failure would test primary support at 2600. Reversal of 63-day Twiggs Momentum below zero warns of a strong primary down-trend. Recovery above 2900 is unlikely but would indicate continuation of the primary up-trend.

Straits Times Index

* Target calculation: 2600 – ( 2900 − 2600 ) = 2300

Colin Twiggs

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.