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U.S. Stock Market & Gold Price Predictions – Next Major Move.

July 9th, 2012 · Chris Vermeulen · 29 Comments

The term Stock market predictions is a very controversial topic and does seem to give off a negative/non-credible overtone to most traders, investors and the general public. We all know you cannot predict the market with 100% certainty, but knowing that you can still predict the market more times than not if done correctly. Keep in mind that the term “market prediction” is also known as a market forecast or technical analysis outlook and is nothing more than a estimated guess of where the price for a specific investment is likely to move in the coming minutes, hours, days, weeks and even months.

Getting back on topic, this report clearly shows how the US dollar plays a dominant role in the price of other investments. Understanding how to read the Dollar Index will make you a better trader all around when trading stocks, ETF’s, options or futures.

SP500 Stock Market predictions – 10 Minute Chart:
These charts clearly show the inverse relationship between the stock market and the dollar index. Knowing how to read charts (candle sticks, chart patterns, volume etc…) is not enough to give you a winning edge. You must also understand inter-market analysis as all markets are linked together in some way and the dollar plays a major role in where stock prices will move next. Review the charts and comments below on how I came up with my stock market prediction and trade idea.

Most Accurate Stock Market Predictions

 

Gold Market Prediction – 10 Minute Charts
Gold is another investment which is directly affected by the price of the dollar. Review charts for more details.

 

Gold Market Forecast Procetions

 

Long Term Stock Market Forecast:
The weekly dollar chart is VERY IMPORTANT to watch as a short term trader and long term investor because trend changes in the dollar means you open positions will also likely change direction.

So, if we apply technical analysis to the dollar chart as seen below. You will notice we are able to create a market forecast and predict roughly where price is likely to move and how long it should take to get there. If the dollar can break above the red resistance level then we can expect a rally for 4 – 8 weeks and a price target around the 87-88 level.

If this is the case then stocks and commodities would likely do the inverse price action and move lower, sharply lower…

Dollar Long Term Market Forecast

 

Stock Market Predictions & Gold Market Forecast Conclusion:

In short, the next weekly candle stick on the dollar chart could be a game changer for those who are long the overall stock market.

I will admit that the current market conditions are not easy to trade because of all the headline news rolling out of Europe each week along with economic data. And I feel as though we have been tip toeing through a mine field for the past 12+ months waiting for extremely negative news or extremely positive news to trigger a wave of buying or selling that will make our jaw drop, but it has yet to happen. Remember always use stops and don’t get over committed in a headline driven market.

If you would like to receive my free weekly analysis like this, be sure to opt-in to my list: : www.GoldAndOilGuy.com


29 responses so far ↓

  • 1 Greg Atkinson // Jul 12, 2012 at 3:00 pm

    Looks like U.S. stocks are on a trend downwards at the moment. Gold prices are also looking a little softer with it trading around 1570 USD yesterday.

  • 2 Lachlan // Jul 12, 2012 at 6:27 pm

    It may be pertinent to note that gold shares (canary) are once again being slaughtered and that bodes well for a spike in the dollar index and a further significant sell off in other share classes. If so I guess Obama may kiss another term goodbye. Julia does not have to go until Nov 30 2013 but she is not popular regardless of any share market crash

  • 3 Lachlan // Jul 13, 2012 at 5:53 am

    DXY has broken away hitting 83.8 last night. Not to say it can’t fade now but odds favour approx 88 imo. Watching some of the gold shares I have they look like they are nowhere near bottomed or ready to rally yet.
    Some dividend paying shares had held up well last 12 months when I looked through them on the weekend eg TLS, banks and others.

  • 4 Lachlan // Jul 13, 2012 at 6:07 am

    One prominent feature of markets generally in the last couple years is the way they constantly break down or up, suck in the breakout traders and then promptly reverse and run the stops. The dollar index has a history of going for wild runs however you would have to be cautious. Better still just don’t trade at least not until a major move does come about. It would be safer to wait for the dollar to extend much further to the upside with a blow off top and then short it rather than buy (buy or short) into this mess. When the short dollar trade does resume it’s gonna be a blast but there is no guarantee it will begin with a spike up either. This latest rally began in a very sedate manner with a bear flag that broke upward against the the classic technical prognosis for such a situation .
    http://www.marketwatch.com/investing/index/DXY

  • 5 Greg Atkinson // Jul 13, 2012 at 2:45 pm

    It seems we now have speculation(?) that gold prices may have been manipulated. I am actually not quite sure what to make out of this article: The price of gold has been manipulated. This is more scandalous than Libor

    The video clip is worth watching.

  • 6 Lachlan // Jul 13, 2012 at 8:30 pm

    Greg the mainstream are way behind what’s really happening in the markets. PM manipulation has been in the courts even to the point of Andrew Maguire being able to correctly inform them of the precise time a large short position would be added. More to the point what is not manipulated? Every CB suppresses interest rates when it suits including our own. Nobodies hiding that. How do we get a derivative problem at least 15 times the size of world GDP without skewing prices? I could make a list longer than this page.

    Another eg of mainstream way off the mark.

    http://www.youtube.com/watch?v=aX8lx9Mglcg&feature=related

    Although I think Bridget was personally honest but misunderstanding of the facts.

    I have thought this through a lot. I have found that very few people want to know about these issues in general day to day living. It’s of interest to people in markets and finance (market watchers like us) and the rest couldn’t care less beyond a ten minute morning tea conversation. I believe most people intuitively know that governments are keen to control whatever they can. I think that the mob will not make hard decisions to break free from any system while we still live lives with decent living standards. If the hoards ever get hungry there may be a major change….maybe.
    Also I am happy to tell people also what I think is the truth but I wont trade a market on what I believe it should be in some utopian, ideological sense either. If gold or any market is manipulated you have to be careful, it could do something you do not expect if you believe the free market is waiting just around the corner to sweep you to victory.
    Holding ones assets over long periods to ride out the volatility that has become the status quo seems sensible. And some diversification which I am beginning to work on myself.

  • 7 Lachlan // Jul 14, 2012 at 7:02 am

    High for dx last night 83.78. A pretty steep run up for the week.

  • 8 BP // Jul 14, 2012 at 6:56 pm

    It’s no secret to any of us that markets are manipulated*. Responses which follow that newsclip are as interesting as the clip itself, particularly those which take the view that gold’s _long history_ as a medium of exchange is critical.

    It is relevant… but let’s also consider that seashells have a _very_ long history of use, across the globe.

    http://en.wikipedia.org/wiki/Shell_money

    * The classic PM manipulation during my time here was the Hunt brothers attempt to corner the market in silver. Often wonder whether their driving silver to US$50/oz sped the development of the digital camera at all… . I recall what a pain in the butt it was recycling silver halides in the late 70s, until non-halide technologies developed… .

  • 9 Lachlan // Jul 15, 2012 at 9:40 am

    At least the metals would not function as a common means of exchange in a system which is centralised and inflationary by nature. People perceive them to have intrinsic value and would save them causing deflation.
    I prefer my plastic cards to seashells though BP. They’re a little butt friendlier in the pocket…

  • 10 Stillgotshoeson // Jul 15, 2012 at 10:09 am

    http://www.bullioninvestmentbank.com/morgan-stanley-out-of-silver/

    There are no doubts that the PM market is manipulated. This does not mean you can not use this to your advantage.

    The property market is also manipulated. Through government interventions, FHBG, Stamp Duty rebates, “$50000 upgrades for $5000” deals or free Range Rovers with blocks of land or Cash Back on settlement deals. These all manipulate property prices.

    There are far more PM’s held in “paper” ETF’s than there is actual bullion to cover them. There is a concerted effort to keep PM prices subdued.

    Like all market manipulation it will fail, both in property and precious metals. The market will always dictate price and value in the end.

  • 11 BP // Jul 15, 2012 at 1:15 pm

    Lachlan: “I prefer my plastic cards to seashells though BP.”

    Much lighter than PMs, too. 😀

    Shoes: “The property market is also manipulated. Through government interventions, FHBG, Stamp Duty rebates, “$50000 upgrades for $5000? deals or free Range Rovers with blocks of land or Cash Back on settlement deals. These all manipulate property prices.”

    Let’s see, I’m sure I stated (8, above): “It’s no secret to any of us that markets are manipulated.”

    Yes, I did. 😉

  • 12 Ned S // Jul 18, 2012 at 11:37 pm

    Lachlan: “People perceive them to have intrinsic value” – They have value Lachlan with the going historical price having been about 1.5 times the cost of production for gold. And with a reasonable cost of production at this time being somewhere around USD800 per oz (max) for that same commodity I’d suggest?

    Note 1: If the world is going to “run out” of any important commodities [in my remaining 30 odd years on god’s Earth perhaps?] gold isn’t one of them.

    Note 2: Yep, the price of pretty much everything DOES seem to be manipulated … 🙂

  • 13 BP // Jul 19, 2012 at 1:10 am

    Ned: “If the world is going to “run out” of any important commodities… gold isn’t one of them.”

    Lost count of the jewellers’ shops and department stores (yes, department stores) selling gold bars from 10 grams upward, here in Singapore, Ned. Compared their asking price to the Perth Mint and it’s _far_ more expensive here… . Why, I wonder?

    With its low crime rate and zero tolerance for same, I’ve stopped wondering about the risk of theft of literally millions of bucks’ worth of the stuff on display. What I do wonder about is how these traders can afford to keep that much stock on hand in shops and stores…

  • 14 Lachlan // Jul 19, 2012 at 1:44 pm

    Ned I threw in the perception part because arguing against gold I have often heard that people only “perceive” gold has value. As if to say that gold holders are on shaky ground, the fickle masses may change their minds at any moment. And yet they haven’t for thousands of years. I say they misunderstand golds utility as money/collateral/store of wealth or value. If you lived in a dangerous and unstable country would you invest all your savings in a house which you cannot move or something as easily transportable and discrete such as gold? Even a fixed asset such as a gold mine itself would not be a home for all your personal fortune. Or if you were a fleeing dictator such as Hosni then you can hardly run off with the countries natural resources in any worthwhile amount unless we are talking gold. Even silver is bulky.

  • 15 Lachlan // Jul 19, 2012 at 1:45 pm

    BP, when you say, “it’s _far_ more expensive here… .” do you mean Oz or Singapore?

  • 16 BP // Jul 19, 2012 at 8:49 pm

    Sorry, Lachlan, I’m in Singapore. It’s more expensive here…

    Perception of gold’s high value is certainly alive and well in Asian communities. I’ve seen more gold on display in Chinatown and Little India than I’ve seen anywhere in the world. (Also the most beautifully-cast ingots and bars I’ve seen.)

    Also saw my Rolex on sale, second-hand, for S$6500.00. I paid A$440.00 for it (new) when I got my first promotion. Now that’s precious metal, even accounting for inflation… . 😀

  • 17 Lachlan // Jul 19, 2012 at 9:34 pm

    Very interesting about the high prices and stock on hand anyhow.

  • 18 BP // Jul 19, 2012 at 10:34 pm

    Interestingly, that love affair with The Yella Stuff does not extend to silver. Virtually _no_ interest at all here.

    I brought a lump of amber* as big as my fist with me, hoping to have it transformed into numerous objects d’art for the missus. No interest in that, either. Jade, in all its forms and colours, is the Really Big Deal here. Some small VHQ pieces command really big money. Confess I know less about this than I do wool-classing.

    * Great granddad on the Canuck side saw this great glowing rock emerge while oil-drilling in northern Alberta. It was given to me a decade or so ago by his son. Advice given by one _jade_ expert was that I should travel to Jieyang and Guangdong in China, to have amber cut and shaped. Most didn’t know what it was…

  • 19 Lachlan // Jul 20, 2012 at 6:44 am

    BP I have always thought jade probably came from serpentinite, a very prospective rock which itself has an almost plastic appearance and surface texture and has blue and green shades that stand out in the landscape where it is freshly exposed. We have an extensive band of the stuff about 20km from here. I just checked anyhow and jade is actually either of two closely related rocks; nephrite and jadeite…I think the latter may be the one you see all the fuss over.
    In Australia serpentinite is mined at Marlborough for world class chrysophase which I really like. The Japs I think have a love affair with the stuff..they might actually have a stake in the mine. The rock also has also produced gold (but rarely if ever otherwise does) at Canoona near Marlborough which is quite a story in itself. It is also a source of asbestos. Driving through bush near Kilkivan on the serpenite belt if I remember rightly I found a sign indicating the presence of an asbestos mine…probably a small concern.

  • 20 BP // Jul 20, 2012 at 8:30 am

    It appears to be the really milky light blue jade which is prized highly here, Lachlan. That and the milky white colour itself.

    Had no idea it was mined in Australia… .

  • 21 BP // Jul 20, 2012 at 8:20 pm

    Did the exact calculation on gold price today. They’re asking over A$1915.00 per ounce for gold ingots here in Singapore.

    My rough estimate the other day was close. Perth Mint is asking A$1530.00 per ounce for a similar ingot! 😀

    I’ll concede it may a little be foolish to ask prices while wearing a Raffles Hotel T-shirt… .

  • 22 Lachlan // Jul 20, 2012 at 8:36 pm

    BP maybe selling of gold there is subject to heavy regulations?

  • 23 Lachlan // Jul 20, 2012 at 8:39 pm

    Ok, better lose the shirt too

  • 24 Lachlan // Jul 20, 2012 at 9:12 pm

    Gold stocks continue to fall but now into a rising RSI (diverged) showing the bottom is likely to be close. PM’s themselves also maintaining a bear trend for now but I think this is about to end reasonably soon. Maybe with a capitulation in metal prices and maybe not but likely with metals correlating with the usdx in a flight to safety set up. Market news might be about to turn ugly…albeit I am a market news sceptic. The drama is fun no doubt.
    The usdx does look almost ready for another spurt and the AUD/USD has resistance at about 1.047 approx. Looks good for a change of scenery….bad to worse followed by more official stimulus.

    The Aussie buck sure is a favourite.

  • 25 BP // Jul 21, 2012 at 10:35 am

    Lachlan: “BP maybe selling of gold there is subject to heavy regulations?”

    Fewer than Australia, according to my son… . He was telling me about some common Sing scams last night:

    * Scammers promise, in writing, 8%+ pa return on gold purchases. Never happens of course… . Two variations on this… Gold never materialises at all… or you get the actual gold, but no 8% return. They’re trying to regulate against these gold scams, but regulating against sheer stupidity is difficult…
    (I guess a third scam is selling ingots at peak prices. Or maybe they _bought_ at the high… and need A$1915+ per oz!)

    * Scammers distribute thousands of leaflets to Singapore apartment owners, offering S$300K for their apartment(s). Because many of the elderly paid <$250K for these flats, some actually think it's a great offer. Sale proceeds, than scammer offloads the property for S$450K – S$500K. Fortunately, with many of these places, Singapore regulations prohibit more than one purchase (at a time). Critics of our lack of similar control in Australia might be surprised to learn that realty is buoyant here; wages:prices ratio is higher than ours; and that homes without any government restrictions are much more expensive than 'regulated' ones… . You can expect to pay around S$770K for a 3 BR apartment. Rents are higher than ours. My son was looking at the next rent level up from his: S$45K+ pa… (A$665 pw) for what is a relatively modest apartment in a very ordinary suburb.

    This housing scam is widespread. Apparently many elderly folk fall for it. My son says he has found at least a dozen of these flyers/leaflets for an apartment he _rents_ stuck in his security door. The government is trying to educate Singaporeans to the scam, by placing posters on walls around these housing complexes. There are probably TV ads as well… .

  • 26 Lachlan // Jul 21, 2012 at 1:36 pm

    Oh I see. The amount of scamming going on the last ten years in particular is incredible.
    Of concern too are counterfeit operations producing PM coins of all types. I prefer Perth Mint myself.

  • 27 Stillgotshoeson // Jul 21, 2012 at 4:00 pm

    Interesting article on Kitco about a scam/fraud.. $60 Billion

    http://www.kitco.com/reports/KitcoNews20120720KB_china_gold_scam.html

    Not a lot of detail in the article, best guess is investors thought they were buying gold and have got worthless paper instead.

    Sort of like the ETF market 🙂 There is far more ETF gold than physical.

    Perthmint for me too Lachlan, have purchased some more 1Kg bars recently.
    Have added to the portfolio too and increased holdings of existing as well. Still confident of Gold going higher than lower over the medium term so dips are attractive buy in opportunities.

  • 28 Lachlan // Jul 22, 2012 at 6:11 am

    Kilo a nice chunk Shoes.
    China to overtake India buying gold next year in your article Shoes.
    Why would anyone buy new coins on Ebay I don’t know (see link). Even old coins are faked convincingly in China.

    http://www.youtube.com/watch?v=DkgCnYShoLQ

  • 29 tinalaw007 // Sep 14, 2012 at 4:30 am

    Bullish video on DOM

    I was watching some trade videos on The Contrarian Trader blog and found some great videos. His analysis was really good and be being new I got a lot out of them. I watched his older videos and his calls were accurate as well. I know there are a bunch of guys that pick stocks and send alerts but the contrarian trader puts himself out there to prove himself unlike other so called pros. Does anyone know of his paid services? By the way he has a contest for a discounted membership can someone tell me what chart pattern his is referencing? There are three chances to win so help, I know nothing of candlestick patterns. Thanks in advance!

    http://www.thecontrariantrader.com/2012/09/dominion-resources-oversold-trade-analsys/

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