Bill Baruch, president and founder of Blue Line Futures, previews E-mini S&P, Gold, Crude market...
Adens: What's Next for the Markets
12/12/2014 9:00 am EST
The big news has been the steep drop in the oil price. And despite the drop it’s already had, oil is probably headed even lower. Basically, it’s in a new downside ballgame below $78, observe Mary Anne and Pamela Aden, editors of The Aden Forecast.
Gold, silver, and gold shares appear to be stabilizing, but they’re not out of the woods yet. So it’s still best to maintain caution and keep your lower metals position for the time being.
Our recommendations are essentially holding up well, especially palladium, which hit a ten-week high and it’s likely headed higher. In our model portfolio, we continue to own the ETFS Physical Palladium Shares ETF (PALL).
The stock market is on a roll. The Dow Industrials and S&P500 again recently hit new record highs. And, incredibly, it still looks like stocks are going to rise even further.
In fact, we wouldn’t be surprised if that continues to be the case as long as interest rates stay low. Most of our recommended stocks are very strong, but a few are not. Nevertheless, for now, keep the stocks you have.
Bond prices stalled somewhat after reaching a six-week high. They remain very strong, bonds are bullish, and they’re set to rise further.
As we’ve been saying, if you haven’t bought bonds yet, or you want to add to your positions, it’s still a good time to buy.
Our recommended bond funds are doing fine and our favorite is ProShares Ultra 20+ Year Treasury ETF (UBT), which is the strongest. We also recommend SPDR Lehman Long Term Treasury (TLO) and iShares Barclays 20+ Year Treasury Bond (TLT).
The US dollar surged to a new five year high yesterday. It’s in a league of its own and its fundamentals and technical factors are both very bullish.
This makes the dollar the world’s favorite safe haven and it’ll stay super strong above 87.50. A sustained rise above 89 would signal 91 as the next target. Keep your cash in US dollars.
The currencies are very weak but we could still see an upward rebound in the weeks ahead. If so, use this strength to sell if you’re still holding other currencies.
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