Crude & Energy Complex Remain Bullish in 3Q 2018.
Crude & Energy Complex Remain Bullish in 3Q 2018.
07/25/18 Weekly Re-Lay Alert – Commodity Correction Culminating: “The last few weeks have provided some watershed movement in normally-prescient markets. Those are the markets normally associated with an ability to anticipate what is to come in the economy and/or in monetary policy in the months/quarters that follow.
As discussed in the July 24, 2018 The Bridge, Copper has plummeted after twice testing its 1 – 2 year upside target (~3.3000/HG). Copper is often seen as one of the early indicators of economic or inflationary trends. When it bottomed in early-2016, that presaged an economic upturn.
When it subsequently peaked in late-2017 and then set a double-top in May 2018, Copper signaled the culmination of the latest phase of an inflationary uptrend and ushered in the time for a correction. That, along with similar crashes in many grain markets and a sharp drop in other metals, deflated some of the immediate inflationary pressures.
In response, Bonds & Notes have rebounded as upward pressure on interest rates waned.
Crude, in contrast, has not yet completed its up cycle so it has been bucking this corrective trend, forging higher – on balance – into forecast cycle highs… it could be in for a similar deflating shortly after that.
Of course, many of those deflating markets are also nearing support and providing indication that those corrections are culminating. If so, it could be time for the start of a new upswing in price inflation.
Since substantial damage has been done to the previous uptrends – in markets like Copper, Gold & Silver, Soybeans & Corn, Coffee & Sugar and even Lumber – a bottom does not necessarily coincide with an accelerated move up.
Instead, those markets are likely to go through a new bottoming phase and steadily build a foundation from which a 2019 surge higher becomes more likely. And that would fit perfectly with cycles described for Soybeans, Gold, Bonds and even Stock Indices – with the greatest concentration and collision of cycles surrounding 3Q 2019.
In the meantime, other markets have not done as much damage to their previous uptrends and were/are poised to enter new up phases that could head to new 2018 highs in the foreseeable future…
Crude Oil, Unleaded Gas & Heating Oil turned their daily trends up to begin the week with Crude being able to maintain its ascending daily 21 MAC.”
Crude Oil and the Energy complex remain positive as they complete ongoing analysis for a substantial bull market from Sept. 2017 into ~Sept. 2018 (Unleaded Gas & Heating Oil signaled uptrends in July 2017, but convincing uptrends were not expected to take hold until Sept./Oct. 2017).
Crude is still expected to set another new high – during 3Q ’18 – to fulfill diverse upside objectives and then set the stage for a substantial sell-off (price targets have been published for subscribers). That would then complete its 6 – 12 month up cycle (since Sept./Oct. ’17), as well as a ~16-month low-low-(high) Cycle Progression. This action continues to dovetail with Middle East cycles that signaled a major shift from late-Sept. ’17 into late-Sept. ’18.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.