A look at the big picture today – and starting with the market darling – or perhaps was the market darling!! Nvidia.
As we can see here from the weekly chart (semi-log scale), it is still trading in the very steep up slanting wedge pattern. As I have mentioned before I think we will see this stock back at around 80 (don’t forget they knocked off a nought on the end of the price). Longer term the picture is not encouraging.
View attachment 6330783
Then when we turn to the chart of the weekly close of the NASDAQ, we see the same type of up slanting wedge although not as sharp as Nvidia. Turned lower during the week but I suspect we will soon see a break of the uptrend.
View attachment 6330792
The Russell 2000 index caused a bit of excitement when everyone suddenly discovered the stocks lower down the list. Some analysts saw this as a positive sign. I don’t. I saw it as scraping the bottom of the barrel. As we can see from the chart, it has done nothing since the high in late 2021.
View attachment 6330789
And moving on to the weekly close chart of the S&P, note again that we have another beautiful up slanting wedge with the close on Friday right on the lower boundary. Not a good look.
View attachment 6330795
Gold still trying to break as many hearts as possible as is its wont to always do. After scoring another all time high during the week, prices came off sharply again on Friday. We can see here on the chart of GLD (the yellow stuff) and GDX (stocks) the damage that was done. On the lower level of the chart is the ratio of these two. As we can see, it came back to nearly sit on the ratio line which, as I have pointed out previously, goes back to July last year. I really would like to see the stocks to start performing better than the metal. GDX has outdone the metal over the past month, but I don’t think nearly enough to represent the degree of the rise in gold.
View attachment 6330798
Back on Aussie soil – 20pt P&F chart of XJO. As we can see the sideways work this index did for the first half of this year built up a reasonable degree of support between 7600 and 7900. Like to see how it behaves when it gets back into this support.
View attachment 6330801
And now something to really have a worry about – the price of steel. It has continued to ease below recent trading.
This is serious.
View attachment 6330810
After the last chart, now a look at the weekly chart of BHP. I didn’t just draw in any of these lines. They were already on the chart. See where BHP closed on Friday. Yes, there has been lots of trading below $40 but for the longer-term picture, I would have liked it to look a bit more encouraging – or at least, less worrying.
View attachment 6330813
Changing the music – how about this for an interesting chart. The Indian Sensex index. What a trend channel but it looks very toppy just here.
View attachment 6330816
I saw this comment which I thought was hilarious:
“CrowdStrike seemingly borrowed Boeing’s approach to quality control, except instead of building planes where the doors fly off at the most inopportune times, it released a piece of software that blew up the transportation and banking sectors”.
No notes next week – Christmas in July so will have other matters on my mind!! Probably means it will be the most important week of the whole year.
(20min delay)