Breakout Ahead for Resources?

04/24/2018 5:00 am EST

Focus: COMMODITIES

Mary Anne & Pamela Aden

Co-Editors, The Aden Forecast

Gold, gold shares, energy and our resource shares are looking great, suggests Mary Anne and Pamela Aden, editors of the industry-leading economic and commodities advisory service, The Aden Forecast.

Russian sanction concerns in aluminum and now nickel too are giving the already strong market a boost. Silver finally jumped up too! It’s starting to wake up, and as you can see on the chart below, it’s starting to break up and out of its two-year triangle while its indicator jumped up with room to rise further.

chart 2

This is good news for both the resource and precious metals sectors. Crude hit a 3 ½ year high today, while gold is trying to decide if the B decline is truly over.
Whether it is yet or not, the overall environment continues to grow towards having great potential this year and the years to come. The time has arrived. Keep your positions.

Note on the chart how the energy shares are now catching up to the strong crude oil price. And they too have room to rise further. This is giving an extra boost to the stock market as it rose in a rebounding rise this week. It’s to be seen if this is the start of another leg up in the bull market. We’ll sit tight with our positions.

chart 1

If the following indexes can rise and stay above these levels, a renewed rise will be underway: 25000 on the Industrials and 2720 for the S&P500. The Transportations and Nasdaq are already looking better by staying above 10600 and 7200, respectively.

The dollar index rose today when the long dated Treasury yields jumped up to an almost one month high as inflation expectations rose.  The 10 year yield is once again approaching its key 3% level, while bond prices declined.

The U.S. dollar remains weak within its 11 week sideways bottoming band. It still has room to rise in a rebound rise while the currencies soften. If the dollar index rises and stays above 90.60, it could then start a temporary rise to possibly even the 94-95 level, yet still be bearish.

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