Friday, June 18, 2010

Macro Week in Review 6-18-2010

Quadruple witching Friday ended with a Doji day (open and close nearly identical) on the equity indices. There was a great rally in gold, as I have been calling for some time, to new highs, the dollar continued its pullback and oil ended in limbo. Let's go to the charts for more details:

Gold Daily

Gold Weekly

Gold broke through the recent highs today. Now on its way to 1300 from reviewing the daily chart. The weekly shows a continued up trend as well.

US Dollar Index Daily

US Dollar Index Weekly

The other currency. Broke down through the trendline on the daily chart and now sees support at the 50SMA at 84.52. The weekly chart looks worse with support at the 20Wk SMA at 82.71 then the 82.34 trendline.

Oil Daily

Oil Weekly

The daily chart for crude oil shows a lot going on. The 50/100/200 SMA's are all within a $1.63 range with the 50SMA crossing the 100SMA and heading to cross the 200 SMA. It is going to move somewhere, up sees resistance at 80 and down sees support at 74.50. The weekly chart would lead you to believe that down is more likely. It is tapping the 20wk SMA and and retesting the trendline.

Volatility Index Daily

Volatility Index Weekly

The daily VIX touched its support at the 100/200 SMA near 23.30. A break through sees next support at about 18.50. The weekly is also on support at the 20/50 wk SMA. Break down on the weekly sees support at the trendline at 19.67.

Now moving to the Indices.

SPY Hourly

SPY Daily

SPY Weekly

Three charts for the SPY. The hourly chart clearly shows the reduced volatility the last few days and a series of near doji to end the day Friday. This says a move is coming, but which way? Moving to the daily chart there is consolidation after a recent rise above the 200SMA. You might expect continuation with resistance at the 100SMA above. But also note the 50 SMA coming down from above and the hanging man candle from Thursday, both bearish signs. The weekly chart shows a break of the down trendline and a coming test of the 20wk SMA 113.21 (near the daily resistance of 113.41). Seems still in a tight range and need to watch carefully.

IWM Daily

IWM Weekly

The IWM daily chart has cracked the 100SMA and is finding support there. It is now solidly within the range from 2008. The 50SMA coming down bodes slightly bearish near term and acts as resistance. On the weekly chart IWM has tapped the 20 wk SMA and is sitting on the positive side of ST up trendline and 200wk SMA. The weekly looks positive with resistance at the pink trendline. So again conflicting views and one must watch carefully.

QQQQ Daily

QQQQ Weekly

QQQQ's broke a descending triangle this week and rose to the 50SMA today, being resistance. The 100SMA below is support. The doji today signifies indecision. Looking at the weekly chart there is a flagging after a break down below the up trendline with resistance near the year end highs. Pushing higher sees resistance at the trendline and there is support at the 20wk SMA below. Another tight range and conflicting information between the daily and weekly.

How do you sum it all up? Gold is just flying, no questions about it, and the dollar appears to need some more time to consolidate. Oil and the equity indices all seem to be in ranges and need to be watched carefully. When the break the range they will move and you need to be ready.

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