Monday, June 4, 2012

Another Bullish Technical Indicator for Silver?

In addition to the classic reverse head and shoulders pattern forming in silver, there is another very interesting bullish indicator currently. But first, credit to where credit is due. This is not my observation, but that of poster SRSrocco over on the TFMetals boards.

This particular pattern involves a divergence between the price of silver and its Accumulation Distribution Line (ADL). What is an ADL you ask? The ADL is purely a technical indicator. It is merely a calculation involving existing price and volume information. According to there are three steps involved in its calculation:

1. Money Flow Multiplier = [(Close - Low) - (High - Close)] /(High – Low)
2. Money Flow Volume = Money Flow Multiplier x Volume for the Period
3. ADL = Previous ADL + Current Period’s Money Flow Volume

In a nutshell, the ADL is the running total of the Money Flows weighted by volume. The Money Flow itself is an indicator of the underlying market pressure which is either positive or negative. For instance, if the price of silver closes in the upper half of its daily range, that is considered a positive Money Flow. So even if the price is net lower for the day, it is still a positive sign as it recovered significantly off its lows. This is interpreted as a potential long term upper buying pressure being acted upon by a short term selling pressure. (more)

U.S. Dollar Is Not Overbought

Few charts of interest:

NASDAQ HIGH LOW INDEX – 60 EMA is firmly pointed down. Very bearish for markets.

Dow Jones Transports – bear flag spotting

CRM – a lot of room on the downside here as broadening top is very bearish formation

XOM – failed cup with handle can see a quick move lower.

FXE – could trade in the $100-110 before this is all said and done.

GG – why would you be buying miners with charts like this?

JJC – should shed another $5 before hitting support.

KMP – where I think this is a good buy.

Few charts of interest:

Bart Chilton: Silver Investigation to Conclude by September if Not Sooner

The Doc contacted CFTC Commissioner Bart Chilton this week regarding the delay by the CFTC and the SEC in enacting position limits in silver, as well as the CFTC’s silver manipulation investigation, which is now in it’s 4th year.
As the CFTC’s Commissioner’s have recently come under extreme criticism by the silver community, with long-time supporter Ted Butler finally throwing in the towel last week and calling for Chilton and Gary Gensler’s dismissal, we offered Bart the opportunity to speak with The Doc to update readers on the progress of both the silver investigation as well as the implementation of position limits.
Commissioner Chilton has deferred a live interview until the silver investigation is concluded ‘in the next 2-3 months if not sooner‘, but has allowed SilverDoctors to publish his response regarding these inquiries. (more)

Jim Sinclair: Worst Case Financial Scenario Unless Fed Goes Full QE by End of June

The legendary Jim Sinclair alerted email subscribers this afternoon that the financial system faces ‘the worst case economic and social scenario in 2012‘ if the Fed does not announce Full QE by the end of June.

Sinclair states the Fed is playing a game of chicken that will end disastrously without immediate massive official stimulus.

Sinclair says this is what the Fed is risking unless MASSIVE QE is unleashed by The Fed before the end of June:

“Gold Just Went Over $2000, By Tonight That’ll Cheep” Rollover-1981 2:55
This is what the Complete and Total Economic Collapse of the United States and the World looks like on film.
As seen in the movie Rollover 1981.
The Federal Reserve and Alan Greenspan engineered the greatest financial catastrophe in history of the planet. The Federal Reserve must be audited and abolished! Audit the US gold in Fort Knox. Prosecute the Wall Street criminals. Reinstate Glass-Steagall. Enforcement of regulations is key.

Chart of the Day - Walt Disney Company (DIS)

The "Chart of the Day" is Walt Disney Company (DIS), which showed up on Thursday's Barchart "All-Time High" list. Disney on Thursday posed a new all-time high of $46.10 and closed up 1.13%. TrendSpotter has been long since May 8 at $44.30. In recent news on the stock, Morgan Stanley on May 29 reiterated its Overweight rating and raised its target to $51 from $46 due to increased margins and its Avengers movie success. Walt Disney Company, with a market cap of $81 billion, is a diversified worldwide entertainment company with operations in five business segments: Media Networks, Studio Entertainment, Theme Parks and Resorts, Consumer Products and Internet and Direct Marketing.


The Trend Trader for Futures Trading On Monday, June 4, 2012




Trend Reading
S&P 500 - Jun ESM21274.00− 2.691303.471293.92Bearish
Dow Jones - Jun YMM212103− 2.161234212266Bearish
Nasdaq - Jun NQM22455.00− 2.732512.832493.00Bearish
Russell - Jun TFM2736.20− 3.27755.80750.00Bearish
US T-Bond - Sep ZBU2152-03+ 1.59149-27150-11Bullish
US T-Note - Sep TYU2134-24+ 0.59133-30134-02Bullish
US Dollar Index - Jun DXM282.973− 0.1983.04582.848Neutral
Australian Dollar - Jun ADM20.9671− 0.520.97000.9705Bearish
British Pound - Jun BPM21.5372− 0.211.54401.5451Bearish
Canadian Dollar - Jun CDM20.9613− 0.690.96790.9659Bearish
EuroFX - Jun ECM21.2413+ 0.391.23921.2442Neutral
Japanese Yen - Jun JYM21.2806+ 0.261.27211.2746Bullish
Swiss Franc - Jun SFM21.0337+ 0.431.03201.0356Neutral
Feeder Cattle - Aug FCQ2157.375+ 0.10156.700157.242Bullish
Live Cattle - Aug LCQ2119.600+ 0.17118.819119.125Bullish
Lean Hogs - Aug LHQ291.300+ 0.3089.99489.867Bullish
Corn - Jul CN2551^4− 0.68559^4562^0Bearish
Wheat - Jul WN2612^2− 4.89641^0635^6Bearish
Soybeans - Jul SN21344^2+ 0.321356^41354^4Bearish
Soybean Meal - Jul SMN2394.5 0.00401.7399.8Bearish
Soybean Oil - Jul BON248.59− 1.2449.3149.22Bearish
Crude Oil - Jul CLN283.23− 3.8186.5385.91Bearish
Heating Oil - Jul HON22.6279− 2.792.71202.6981Bearish
Natural Gas - Jul NGN22.326− 3.962.4092.420Bearish
Gold - Aug GCQ21622.1+ 3.701573.41595.4Bullish
Silver - Jul SIN228.512+ 2.7227.92228.147Bullish
Copper - Jul HGN23.3135− 1.553.37093.3740Bearish
Orange Juice - Jul OJN2111.70− 0.31111.26112.30Neutral
Sugar - Jul SBN219.09− 1.7019.4119.29Bearish
Cocoa - Jul CCN22063− 0.9620732082Bearish
Coffee - Jul KCN2157.50− 1.96161.62161.15Bearish
Cotton - Jul CTN268.59− 4.1470.8270.82Bearish