Dog days of summer bring transitions, spending, food, tensions, & infection rates, explains Trevor Smith.
In mythological folklore, appearance of the “Dog Star” signaled floods and crops to Egyptian culture but drought and plague (increased infection rates) to Greco-Roman culture. World markets reflect this folklore time period being mixed, technically speaking, in that indices are bearish for next week, while currencies and some commodities have bullish technical elements. Neither the Dow Jones Industrial Average nor its Transports stock subset made higher highs with other indices.
Last week’s report described this week’s early market action, with consumer-spending ETFs converging to give early sell signals on intraweek highs. I was correct about a massive gold breakout but incorrect on its and the euro’s direction. Finally, six of 10 ranges printed as of Thursday with other ranges extremely close.
Next Week’s Predicted Ranges (Thursday Night)
E-mini S&P 500
High Range 3291-3267; Low Range 3220-3190 (outlier 3101)
Neutral-bearish range. VIX futures on 50-week moving average support. Buy 3250s current price strike in weeklies as put spread on Implied Volatility.
Japanese Yen
High Range 9394-9378; Low Range 9335-9301
Neutral-bullish range due to candlesticks. Join next week’s big pivot/range breakout in either direction.
Euro FX
High Range 1.169-1.165; Low Range 1.154-1.150
Neutral weekly range: Monthly chart bull candle encompasses 20-,50- and 80-month averages.
Gold
High Range $1,926-$1,908; Low Range $1,857-$1,836
Neutral range based on overbought oscillators.
Crude Oil
High Range $43.29-$42.40; Low Range $40.81-40.01
Neutral-bearish extension range. Low Implied Volatility. Sell call spread if bearish on next week.
Last Week’s Predicted Ranges (Thursday Night)
E-mini S&P 500
High Range 3261-3242; Low Range 3172-315 (outlier 3059)
Neutral-bearish range. Understudy oscillator negative divergence. Buy a put spread, if a believer of the bear story, waiting for stops runs. Buy week’s low after stops runs.
Actual: 3284-3192
Japanese Yen
High Range 9372-9351; Low Range 9308-9287
Bearish range due to three-day candlestick. Breakout for next week. Sell call spread or join breakout either direction.
Actual: 9380-9303
Euro FX
High Range 1.147-1.142; Low Range 1.135-1.131
Bearish weekly range; Bearish candlestick patterns in technical resistances & strongly-trending breakouts. Hold/add short monthly call spreads.
Actual: 1.164-1.139
Gold
High Range $1818-$1806; Low Range $1788-$1777
Neutral-bearish range based on Daily chart Doji breakdown signal. Sell call spread monthly based on weekly chart.
Actual: $1897-1795
Crude Oil
High Range $42.92-$41.50; Low Range $39.87-$38.88
Neutral-bearish range. Quarterly chart bullish targets at $51 for Fall. Fri-Mon breakout possible.
Actual: $4251-3997
Trevor Smith is a technical market analyst/forecaster who is registered as a Commodity Trading Advisor. Trevor holds four academic degrees across several disciplines and has published works in: Nashville Lifestyles Magazine, The Colorado Daily, The Tennessean/USA Today, Vitamin Retailer, and other media. You can view “Trevor’s Trading” here.
