The big news on Friday was DWTI finally hit the 200 level which I publicly called in an article Oct. 27th when it was under 110, but also called in my trading room at Seeking Alpha when it was in the 80’s. For those that have followed my trading service from the beginning I called it to 160 once before when it was under 100 and then when it hit 160 called it to 200. It hit 236 high back then and I expect it will this time too, so will keep that 236 mark as a double top for now. It very well could go higher the further we sink into deflation. For now though I do think we may get a little bounce in oil with dollar weakness.
Before the markets opened on Friday I said at 9:18am EST “We could have a crazy day ahead of us.” It was a crazy day and com Monday we don’t know what to expect but some playable trends are developing. This is a good time to recommend reading the Trading Rules again as the Fed meeting is scheduled for the 16th. I cannot recall a more important Fed meeting and I would have some powder dry going flat into the announcement.
I have been leaning long gold and recommended a few plays on the on Friday. I am still liking gold long with this dollar weakness and we may get a great bounce if the dollar continues to slide as investors wake up to this slide. Gold should counteract the dollar direction so let the dollar give you the trade come Monday.
Doesn’t change my mind about gold under $1,000. I have 5 more days of my book Illusions of Wealth left in perfecting it before sending off to the editors. I make the case in the book for a continued deflationary setup and just because we get some temporary dollar weakness and the Fed may raise rates this week doesn’t mean we are finished with the deflation and inflation is going to be ushered in. Far from it.
This whole week is about the Fed and one of the most historic meetings to date.
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About Doug EberhardtDoug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
Disclosure:
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.