Hi Norah, I honestly don't think anyone can be sure of a clear path for commodities or equities atm.
There are many conflicting forces and although I'm of the opinion the negative ones will outweigh the positives soon enough, the whole timing thing and putting it all together into a trade plan is difficult to say the least.
Most punters would agree we are most likely facing a recession in the near future, in which demand for commodities will fall away.
However, the China factor can't be discounted.
China is obviously the biggest buyer so the questions each investor should be asking regarding China are how soon is it reopening?
Is the current/planned stimulus just enough to keep developers and provinces treading water or are they looking to take after the West's 'keep the printer rolling' policies?
Then that whole Covid thing, which really throws a spanner in the works.
Sure they've loosened restrictions but with a population of that size can their health system keep up or are we going to see another backflip by government to calm things down?
All those questions are above my pay grade, so I'd love for anyone to shed some (unbiased) light on any of those points.
We've all just witnessed the effect CB printers can have on things so do you bet on China or do you bet on a global recession taking down demand?
Who knows but heres a simple chart to see the effects a recession can have on commodities.
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An easy way to answer whats next for IO is an updated chart from previous post.
As you can see IO is poised to kick on.
There's been a healthy consolidation here just below resistance - this is good for bulls.
However, there is some heavier resistance just beyond that with the 200dMA and a HVN to get through.
Momentum indicators are all looking as though they are about to roll over but a decent breakout would fix that real quick.
Iron Ore daily
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Moving over to FMG and it's very much advantage bulls.
The sp backtested old resistance (potentially new support) yesterday and came through that challenge well.
As you know I'm not convinced on the China reopening story or the looming recession so was looking for an island top pattern to see a healthy retrace however I was not ready for the palm trees up here. lol
Price either reverses in the very near future, which will open up that island reversal.
Or yesterdays successful backtest is the breather the sp needed and she runs off into the sunset
I've attached the weekly chart below as it's easier to view (and draw on lol), although I can tell you momentum indicators are looking a little hot on the daily, so keep that in mind if deciding on positions.
BHP is looking like it really wants to roll over if it can't recapture $46+ - seems copper has a similar TA set up to IO.
So looks like the ball really is in China's court for the next ST move.
FMG weekly
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Anyway thats my my quick take on things.
All the best and good luck whichever way you trade...
(20min delay)