10Year Bond yield is now in resistance area between 3.90 – 4.20. It can rest there. But final resistance can be seen near 4.80 where is upper line of longterm downtrend channel.
Bonds can be traded by Bond ETF or Short ETF for Bonds
I was quite reluctant to buy long positions during last week rally. I would like to see more significant correction first.
Yesterday stock markets presented bearish signal. After very strong open with gap up they reversed their course and finished day on their lows. There was also strong volume too.
Below is example of Nasdaq chart. Nasdaq is leader of current rally and bearish reversal candlestick with strong volume signalize that we could see some correction. Correction which is much needed, I think.
What is your opinion ?
If you look at weekly or monthly chart of gold you can spot that price is now near important resistance level.
A lot of people expect continuation of uptrend into new highs. But one can also see this chart pattern as possible bearish reversal double top pattern.
If you trade commodity ETF for gold , you can trade it long with GLD or short with Short ETF for gold like DZZ or DGZ
Health care stocks and sector was one of strongest part of US stock markets.
But last week completely changed picture and this sector lost every sign of strength.
Based on requests from my readers and clients I am now preparing report with investment ideas I want to monitor and trade during Y2009.
These investment themes will be based on global macro strategies I have prepared. They can be traded on stock markets, FOREX or commodities markets. I trade them in my own fund. Most of them are good for position trades.
This report will be paid and will be available for limited number of readers only. I will send more details about it soon by email but if you want to reserve your copy in advance, you can also contact me.
I noticed relative weakness in Basic materials sector. You can see it on chart below. I think that current bearish market sentiment could push this sector more down.
I also prepared several short setups in this sector for tomorrow .
I have noticed gaps on several Ultra short ETFs yesterday. I also received questions regarding this issue. I was looking for some explanation and I found this:
“ProFunds Group … has announced fourth quarter income dividend distribution declarations for its ProShares ETFs. The firm expects dividend distributions for 52 of its 76 ETFs. Capital gain distributions for 35 of the firm’s ETFs were announced earlier today……”
That means that some capital gains and dividend were extracted from price of these short ETF stocks.
I have noticed during my stock chart analysis that 10Y T-Note interest rate is moving in downtrend channel in last 10 years.
Based on simple principles of support and resistance I think that we can expect that this interest rate will drop near 2%. Support level could be between 2.0 to 2.25%.
As you can notice, I do not post too much now. The main reason is that I did not trade too much with individual stocks in last two weeks.
I have not found too much good trade setups in individual stocks during last two weeks. I made few ETF trades with Ultra short Gold ETF and Ultra short Oil ETF. Right now I am shorting bonds using Ultra short Bond ETF (PST). There is good setup right now in this bonds ETF.
But I feel that some consolidation is in progress on US stock markets . I already noticed several stocks acting relatively strongly in last week, so I closely monitor them for possible long trade setups.
I hope you are short gold and Oil as I am (I noticed it several times in last weeks).
I was not able to find a lot of good stock trade opportunities during last week. But fear of last weeks allowed me to enter short trades in Oil and gold on very interesting levels. I did it using Ultra short Gold and Ultra short Oil ETF stocks.
As global world economy is slowing rapidly I expect commodity trades are out of interest. Prices of gold and oil will go down.
