Hey Guys, The US100 just broke out of its consolidation pattern and currently retesting should bounce off or coil during this intense week of earnings and news. As shown, I expect the price to retest the downtrend resistance line in yellow but it's a strong trend line and has the 200-day ma that will push them down. We Have so many indicators showing we are going to have more volatility coming. As shown below we have a head and shoulders pattern on the US10Y, we are hitting trend lines on the VXN & VIX, Silver is still falling and all major us indices have a bearish engulfing candle. So my belief is that we will roughly follow the trend outlined (A-Y) hitting our last leg down then possibly if gold and silver find support and the DXY hits its trend line again pushing it down the US markets could bull hard out of the downtrend as inflation price pressures are calming down ( Commodity prices and excess stock ) coming into play just like what happened during the 1970s. I don't think the economy or the stock market is out of the woods when it comes to inflation though like all inflation cycles it comes in waves and progressively gets worse each inflation pulse greater than the last.
But there will be periods of relief in between these pulses, when we hit that Y leg look for divergence on the RSI, strong rejection off the support line of the downtrend, Silver and gold bulling, Vix & VXN overextending, Bond yields continue to fall, DXY falling. These will be the signal that we will bull out of this downtrend and wait for the next inflation spike probably start-mid 2023. Keep an eye out for contagion with Sri Lanka, According to the UN there are up to 69 countries all facing a similar Debt crisis that could lead to civil unrest and with the war in Ukraine not stopping anytime soon food and energy security is extremely fragile for these nations.
Im going to be posting Charts on the silver/gold, US10Y, DXY,AUD/USD as well expressing these point more.
But there will be periods of relief in between these pulses, when we hit that Y leg look for divergence on the RSI, strong rejection off the support line of the downtrend, Silver and gold bulling, Vix & VXN overextending, Bond yields continue to fall, DXY falling. These will be the signal that we will bull out of this downtrend and wait for the next inflation spike probably start-mid 2023. Keep an eye out for contagion with Sri Lanka, According to the UN there are up to 69 countries all facing a similar Debt crisis that could lead to civil unrest and with the war in Ukraine not stopping anytime soon food and energy security is extremely fragile for these nations.
Im going to be posting Charts on the silver/gold, US10Y, DXY,AUD/USD as well expressing these point more.
