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 Stockcharts.com 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

INDICES	Close	% Change	3x1	7x5	Minor Trend	Major Trend	Trend Reading
S&P 500 - Jun ESM2	1274.00	− 2.69	1303.47	1293.92			Bearish
Dow Jones - Jun YMM2	12103	− 2.16	12342	12266			Bearish
Nasdaq - Jun NQM2	2455.00	− 2.73	2512.83	2493.00			Bearish
Russell - Jun TFM2	736.20	− 3.27	755.80	750.00			Bearish
INTEREST RATES
US T-Bond - Sep ZBU2	152-03	+ 1.59	149-27	150-11			Bullish
US T-Note - Sep TYU2	134-24	+ 0.59	133-30	134-02			Bullish
CURRENCIES
US Dollar Index - Jun DXM2	82.973	− 0.19	83.045	82.848			Neutral
Australian Dollar - Jun ADM2	0.9671	− 0.52	0.9700	0.9705			Bearish
British Pound - Jun BPM2	1.5372	− 0.21	1.5440	1.5451			Bearish
Canadian Dollar - Jun CDM2	0.9613	− 0.69	0.9679	0.9659			Bearish
EuroFX - Jun ECM2	1.2413	+ 0.39	1.2392	1.2442			Neutral
Japanese Yen - Jun JYM2	1.2806	+ 0.26	1.2721	1.2746			Bullish
Swiss Franc - Jun SFM2	1.0337	+ 0.43	1.0320	1.0356			Neutral
LIVESTOCK
Feeder Cattle - Aug FCQ2	157.375	+ 0.10	156.700	157.242			Bullish
Live Cattle - Aug LCQ2	119.600	+ 0.17	118.819	119.125			Bullish
Lean Hogs - Aug LHQ2	91.300	+ 0.30	89.994	89.867			Bullish
GRAINS
Corn - Jul CN2	551^4	− 0.68	559^4	562^0			Bearish
Wheat - Jul WN2	612^2	− 4.89	641^0	635^6			Bearish
Soybeans - Jul SN2	1344^2	+ 0.32	1356^4	1354^4			Bearish
Soybean Meal - Jul SMN2	394.5	0.00	401.7	399.8			Bearish
Soybean Oil - Jul BON2	48.59	− 1.24	49.31	49.22			Bearish
ENERGY
Crude Oil - Jul CLN2	83.23	− 3.81	86.53	85.91			Bearish
Heating Oil - Jul HON2	2.6279	− 2.79	2.7120	2.6981			Bearish
Natural Gas - Jul NGN2	2.326	− 3.96	2.409	2.420			Bearish
METALS
Gold - Aug GCQ2	1622.1	+ 3.70	1573.4	1595.4			Bullish
Silver - Jul SIN2	28.512	+ 2.72	27.922	28.147			Bullish
Copper - Jul HGN2	3.3135	− 1.55	3.3709	3.3740			Bearish
FOODS & FIBER
Orange Juice - Jul OJN2	111.70	− 0.31	111.26	112.30			Neutral
Sugar - Jul SBN2	19.09	− 1.70	19.41	19.29			Bearish
Cocoa - Jul CCN2	2063	− 0.96	2073	2082			Bearish
Coffee - Jul KCN2	157.50	− 1.96	161.62	161.15			Bearish
Cotton - Jul CTN2	68.59	− 4.14	70.82	70.82			Bearish