What we’re saying here is if the Russell is any indication of the
long-term landscape, these markets are NOT in the process of developing
an extremely long-term top. Sure, we might get lower levels from here,
but there’s just not enough volatility on the monthly charts to suggest a
major developing top.
That’s good news for those of you who are looking to increase
exposure in the months ahead, or for those of you just getting into the
markets now. Although a little patience could go a long way right now,
we do think the markets are going to end up going higher again when it’s
all said and done.
On the commodity front, oil is seeing strength, which probably has a lot of oil bears a little frustrated. We’re not referring to our recent call for a reversal in oil back to the downside, but we are referring to those oil bears who continue to buy the headlines about building inventories and softening demand.
We’ve always been extremely skeptical about oil inventories etc. as it always seems to be a bit of a puppeteering game, but we do still believe oil should move lower now that it has found its way to $50 per barrel. We’re not saying oil’s moving dramatically lower on long-term basis, but we are saying it could be on the verge of a nice short-term reversal soon.
One commodity that has definitely resurfaced from a bullish technical perspective right now though is copper – and with our currently long Freeport-McMoRan Inc. (FCX), it’s entirely possible both of these stock and the more industrial precious metal could start trading substantially higher from current levels.
As you can see in this monthly chart of COPX, the primary ETF tracking the price of copper found its way thrusting above its 3X3 DMA (blue line) for pretty much all of 2016 and into early 2017. Since then, it has pulled back to its 3X3 DMA, but the 3X3 DMA did recently cross the 25X5 DMA (purple line), which can often be an early sign of developing strength.
Basically, we’ve got a number of solid technical reasons here to suggest a potential reversal in copper from current levels. As a matter of strong opinion, we’d be extremely surprised if copper didn’t start trading much better very soon.
The bottom line is any developing strength in copper soon should help FCX. No guarantees, but we do still like the long-term valuation metrics for FCX, and we definitely don’t think the demand for copper is going to wane anytime soon.
On the commodity front, oil is seeing strength, which probably has a lot of oil bears a little frustrated. We’re not referring to our recent call for a reversal in oil back to the downside, but we are referring to those oil bears who continue to buy the headlines about building inventories and softening demand.
We’ve always been extremely skeptical about oil inventories etc. as it always seems to be a bit of a puppeteering game, but we do still believe oil should move lower now that it has found its way to $50 per barrel. We’re not saying oil’s moving dramatically lower on long-term basis, but we are saying it could be on the verge of a nice short-term reversal soon.
One commodity that has definitely resurfaced from a bullish technical perspective right now though is copper – and with our currently long Freeport-McMoRan Inc. (FCX), it’s entirely possible both of these stock and the more industrial precious metal could start trading substantially higher from current levels.
As you can see in this monthly chart of COPX, the primary ETF tracking the price of copper found its way thrusting above its 3X3 DMA (blue line) for pretty much all of 2016 and into early 2017. Since then, it has pulled back to its 3X3 DMA, but the 3X3 DMA did recently cross the 25X5 DMA (purple line), which can often be an early sign of developing strength.
Basically, we’ve got a number of solid technical reasons here to suggest a potential reversal in copper from current levels. As a matter of strong opinion, we’d be extremely surprised if copper didn’t start trading much better very soon.
The bottom line is any developing strength in copper soon should help FCX. No guarantees, but we do still like the long-term valuation metrics for FCX, and we definitely don’t think the demand for copper is going to wane anytime soon.
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