Correction or Reversal? Cast Your Votes! – FX Empire

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Copper continues its own grind higher, and its chart is bullish. That points to the economy being in a recovery, however slow and uneven that is.

Finally, gold remains in its bullish consolidation, and it’s my opinion that it would attempt to extend the early summer gains once the floor in the U.S. dollar probes lower values again. This might take time though, as I look for USDX to spike higher first – quite a few bullish divergences have formed there, and will likely play out over the coming weeks.

Given the weakening oil ($WTIC), that would be little surprising, and actually fitting the October correction hypothesis. No markets go up or down in a straight line, and neither the dollar nor the yellow metal, are an exception.

Summary

Summing up, the bulls’ complacency was shaken to the core, and the extreme greed sentiment readings are history. The put/call ratio has though barely budged, which is hinting at the correction likely having a bit longer to run, at least in terms of time. The advance-decline line has ticked higher, pointing to a likely upswing attempt right next – and we saw that yesterday. The weekly advance-decline line though could still have a way to go before reaching the June extremes – but this can wait for October to happen.

The key takeaway is though that we have seen a sharp correction, and not a reversal. In such circumstances, trading decisions remain a question of the risk-reward ratio, and one’s willingness to let the dust settle for a moment first.

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For a look at all of today’s economic events, check out our economic calendar.

Thank you.

Monica Kingsley
Stock Trading Strategist
Sunshine Profits: Analysis. Care. Profits.

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All essays, research and information found above represent analyses and opinions of Monica Kingsley and Sunshine Profits’ associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Monica Kingsley and her associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Ms. Kingsley is not a Registered Securities Advisor. By reading Monica Kingsley’s reports you fully agree that she will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Monica Kingsley, Sunshine Profits’ employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

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