Technician Corey Rosenbloom, of AfraidToTrade.com, highlights four persistent trends that traders should be watching as they develop across key markets and he also outlines a different perspective of the same trends not seen with ETFs but with futures contracts.
As 2015 continues, we’re seeing persistent trends develop across key markets.
Let’s take a look at one obvious trend, one stealthy trend, and two common trends we should be watching.
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All traders are likely aware of the commodity crash or collapse in Crude Oil prices.
The collapse was widely reported and frequently traded, whether calling the failed bottom/reversal or else simply trading with the trend and profiting from it.
Given the strength in the US Stock Market and generally positive economic news for the United States, a stealth trend has emerged which has surprised many participants.
Bonds continue to generate money flow and relative strength as the related ETFs (such as TLT and IEF) quietly stride to all-time highs.
Be sure to read last week’s Are You Seeing the Stealth Move in Bond Funds? The stealth rally continues.
The two other salient trends—just to select two for simplicity—continue higher in the US dollar Index (seen with the UUP ETF) and gold (also seen as the GLD ETF).
In sum, global money continues to flow into the United States (evidenced from the US Dollar, US Stock Market Indexes, and US Treasuries) but also into the perceived safety of Gold.
Money has persistently flown out of oil which continues to challenge the $45.00 per barrel level.
Here’s a Different Perspective of the Same Trends As Seen Not with ETFs but with Futures Contracts:
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Note the acceleration of the up moves (swings) in both Treasuries and gold through the entire month of January.
Also compare the continued collapse in Crude Oil against the continued strength in the US dollar.
Think globally when studying these markets (in terms of money flow).
If you choose to participate in these trends (ideally trading with the trend on retracements and not losing money by calling elusive reversal points), you can use any number of instruments from ETFs, options, futures, or even related stocks (such as XOM for oil).
By Corey Rosenbloom, CMT, Trader and Blogger, AfraidToTrade.com
