I want to start my weekly market outlook with a perfectly set up market – sugar (SB). We have all in one place – cycles are up, seasonals are up and commercials accumulate long positions. Sugar has rallied last week. But I think the upside is limited and we will get pullback soon. So, have patience and take buy signals. I smell big profits in this market for managed accounts )))
The stock market is really confusing. Last week we talked about it. Cycles were indicating pullback, but other tools pointed to the upside. Weekly closing didn’t help much to clear the picture. But pay attention to the advanced decline line. It is on the same level it was at the beginning of April. But what about the price? Oh gosh, it is the way up from level it was in April. Does it mean we are still in an uptrend? Well, I think so, but I need confirmation. I expect the coming few sessions we will see more downside and then a reversal. If that happens, we are still in a bull market and continue to buy the dips.
The Australian dollar continues to be an interesting market. Commercials are still heavily long. So, I want to be a buyer. I think this week we will get an entry to go long again with the targets I mentioned last week.
Cycles indicate the rally is coming in the American dollar (DXY). But look at accumulation – it is so weak. I would like to see break up above daily tend line, pullback, and rejection. If that happens I will buy DXY. Otherway, I stay sidelines till this market gets some setup.
Wishing you a great week!
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