Daily Chart Report ? Tuesday, August 4th, 2020
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Today’s Summary
Tuesday, August 4th, 2020
Indices: US Stocks continued higher in today's session with the Dow Jones Industrial Average advancing 164 points or 0.62%. The S&P 500 and Nasdaq rose 0.36% and 0.35%, respectively. Small-Caps outperformed with the Russell 2000 gaining 0.69%.
Sectors: Energy led, gaining 2.43%. Health Care and Financials were the only sectors to close lower, slipping 0.44% and 0.41%, respectively.
Commodities: Crude Oil futures moved higher by 1.68% to $41.70 per barrel. Gold futures jumped 1.75% to an all-time high of $2,021 per ounce.
Currencies: The US Dollar Index fell 0.27%.
Interest Rates: The US 10-year Treasury yield dropped to 0.508%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Friendly reminder that overbought is a good thing...
"regime change?"$GLD $IAU $GDX pic.twitter.com/FwMnU0lCx2
— J4 (@J4_doji) August 4, 2020
Today’s Chart of the Day was shared on Twitter by @J4_doji. It's a weekly candlestick chart of Gold over the past two decades, with a 14-period RSI indicator in the lower pane. Gold Bugs celebrated another milestone today as price closed above $2,000 an ounce for the first time ever. The recent momentum has pushed the RSI into "overbought" territory, above 70. "Overbought" sounds like a bearish characteristic, however, @J4_doji reminds us that longer-term, the fact that RSI has reached "overbought" territory is actually bullish. Take a look at the period between 2001 and 2011. RSI was in what we call a "bullish regime" - oscillating between 50 and 100 for a decade. Price surged more than 500% in that time, and RSI never reached "oversold" levels. Then, in 2011, price began to stall for about 8-years. RSI shifted into a "bearish regime" - repeatedly hitting oversold levels and failing to stay overbought. The fact that price is currently breaking out to all-time highs and RSI refuses to fall below 50 is evidence that momentum has shifted back into a bullish regime.
Quote of the Day
“There's no fever like gold fever.”
– Richard Russell
Top Links
Everything's Breaking Out To The Upside EXCEPT The US Dollar - Big Trends Monthly
Here's a great video with Josh Brown and JC Parets. They review several monthly candlestick charts to identify the strongest trends across the markets.
What's Behind Dollar Weakness? - TD Ameritrade Network
Legendary trend follower, Jerry Parker shares his thoughts on the recent price action in Currencies and Commodities.
Biotech Idea Flow - The Rotation Report
Aaron Jackson shares some bullish chart setups within the Biotech space.
Gold, Silver, USD: Where to Next? - Fibonacci.com
Tarek Saab offers his technical outlook on Precious Metals and the US Dollar.
The Most Lopsided Days - The Irrelevant Investor
Here are some thoughts from Michael Batnick and Jonathan Krinsky on the lack of breadth that many are concerned about right now.
Top Tweets
$GLD vs. $GDX since mid-March @TheChartReport pic.twitter.com/DHazvceof0
— Mike Zaccardi, CFA, CMT (@MikeZaccardi) August 4, 2020
