These charts tell a story.
You have reached or are about to reach a level that indicates the potential for a more permanent turn. Commodity price charts may indicate potential inflation in the future. Government bond yield charts may have expressed similar concerns.
Method is as follows Oil chart daily price I see now:
It’s a 32% move from $ 61 / barrel to $ 81 in just two months. Sticking to price chart analysis alone, without even going into the underlying reason, is an extraordinary upward impetus. The July high of $ 76.75 showed little resistance, demonstrating the buying power that exists in the market.
After such a dramatic uptrend, it is expected that the Relative Strength Index (RSI above the price chart) or the Moving Average Convergence / Divergence Indicator (MACD, below the price chart) will show divergence. Maybe, but so far it doesn’t.
It’s hard to understand how the stock and bond markets ignore oil prices rising to the $ 100 / barrel level. This is inflation, no matter what else is happening in China’s interest rates and real estate prices.
Copper daily chart Looks like this:
By connecting the highs of the May peak with the lows of July and September, we can clearly see the stable downtrend line. The October break across that line is powerful and powerful. There is no mistake. Note that they also buy a volume bar (below the price chart).
Copper is used in the manufacture of semiconductor chips, much of which is needed in the manufacture of batteries for electric vehicles.Will the new EV be manufactured by General Motors?
10-Year Treasury Yield Chart Looks like this:
You can see how low yields fell in the original pandemic horror of early 2020. After hitting a .40% low, the 10-year yield returned to 1.768 and then fell, finding a higher low at 1.15% and then returning to the 1.60% range.
Price chart analysts are focusing on the 1.68% level in March 2021. If the yield is higher than that, the next target will rise by about 2%. Such moves could begin to affect stock market investors seeking the security of “good US confidence and credit” if inflation recovers (see oil and copper charts above). ).
Of course, nothing is guaranteed. It may be even easier to see how fuel and metal prices will fluctuate in the coming weeks. The same applies to interest rates. Comments and actions by federal authorities can have dramatic implications.
It is not investment advice. Do your own research and be sure to consult your registered investment adviser before making a decision.