Look For Gold To Consolidate, Crude Oil Higher

SHANGHAI (Aug 4)  Last week’s review of the macro market indicators suggested, as July ended and we moved into the dog days of August to look for Gold (GLD) to continue the bounce in the downtrend while Crude Oil (USO) consolidated or pulled back in the uptrend. The US Dollar Index (UUP) looked lower while US Treasuries (TLT) might consolidate but were biased lower. The Shanghai Composite (SSEC) was biased to the downside but might continue to consolidate while Emerging Markets (EEM) were biased higher in their downtrend. Volatility (VIX) looked to remain subdued keeping the bias higher for the equity index ETFs (SPY), (IWM) and (QQQ). The QQQ charts seemed all for that, while the SPY and IWM suggested there was still some downside risk in the short term.

The week played out with Gold continuing to consolidate while Crude Oil found a bottom and then moved up. The US dollar continued lower and found a bottom while Treasuries made a new low. The Shanghai Composite and Emerging Markets are confirming broad consolidation ranges. Volatility remained subdued and continued to decrease. The Equity Index ETFs rose to new higher highs with the SPY and IWM making new all-time highs while the QQQ made a 13 year high, ending the week on the highs.