Yesterday and today saw very big moves in the markets. Oil was probably the biggest loser falling to as low as 94.50. You see how fast a situation can change in financial markets! Therefore, you’d better be on the right side of a trend. I do believe the move down was temporary and oil will start climbing again pretty soon. The same can be said about other commodities and currencies such as eur/usd, aud/usd or nzd/usd. According to my analysis they will go up and continue their uptrend.
I also think today can be the last day of the fall for oil, eur/usd (and other above mentioned currencies) and also silver with gold. Why? I noticed a tendency that when there is a large move in one direction and then, on the same day, a move in the opposite direction, this usually signals the end of the move. As oil and silver were going down pretty sharp and now they are running up again I predict this as the last downtrend day. I might be wrong, but if we have a trend, it usually goes slowly, bit by bit and correction in a long term trend are very sharp that usually last for a few days, up to a week.
It looks that this is the case with silver and oil. And the currency pairs that I have just mentioned. Anyway, taking a long position in the securities may not be a good idea for day trading, but for a long term investing I believe this is a good level. I have attached for you a silver chart to see what other support levels for it I predict if the commodity continues going down. We will see how the day ends. Don’t risk too much. Have a nice weekend. I will write a short post tomorrow.
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Disclaimer
Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.