When most people think of this market, they think of something boring.
It doesn’t have the same perceived level of excitement as cryptocurrencies and tech stocks. Yet you could argue that this market is the most important of all.
And far from being boring, the moves in this market would put a stock market boom-and-bust cycle to shame. That’s why we keep a close eye on it and try to predict where it will go next.
In today’s essay, we’ll share a trick that can help you time future moves in this market…
A Key Global Market, and a 21-Year Low
The market we’re talking about is the commodities market.
To understand where it might go next, let’s first take a look back at a chart we profiled last week…
This chart tracks the Commodity Research Bureau (CRB) Index. The CRB Index is made up of a basket of 19 different commodities.
Remember, we don’t trade the CRB Index directly. But since it’s a good indicator of the world’s various commodities markets, we do like to follow its performance.
As you can see in the chart above, the index recently broke through a 21-year low (marked by the red line). This is where technical analysis comes in handy…
When we look at this chart, the most important question we ask ourselves as traders is this: How much lower can the index go?
The answer to this question could shape our views for months or years to come. So, to narrow down the possibilities, we reach into our bag of technical tricks.
And one of the most timeless concepts of technical analysis is this: A broken support level may become a new resistance level. Likewise, a broken resistance may become a new support level.
This is why markets will so often re-test old broken levels.
For the time being, we know from the chart above that we broke the longstanding support level. But now, the index is entering uncharted territory.
What happens next will determine whether we have a tradeable bottom in the commodities markets… or if we’ll continue to see a decline to fresh lows.
Either way, we’re keeping a close eye on the CRB Index for a re-test of that broken support.
More to come…
Andy Krieger and Imre Gams
Editors, Money Trends
Kind words from readers for Andy and Imre…
I’ve paid for a lot of different programs over the years and some of them serve me well and others haven’t. I think you both make an excellent team, and you’re bringing a combination of two different types of trade skills and backgrounds together into one opportunity for us.
One of the things I appreciate the most about Andy Krieger’s Big Trades is your stop losses are set tight, and your ability to communicate at any time to make the necessary changes to keep my profits high and my losses low. I have not always experienced that level of attentiveness to the trade that somebody put me into.
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– Thomas K.
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– Ivan T.
Andy & Imre, I just wanted to say thank you very much. You guys and gals are doing a great job. I like the way you are teaching and helping me work along with the currency trading.
I wasn’t a stranger, but I was only in DEMO and not learning the politics and finesse like I am now with you. Please keep up the great work and we will all get some good profits together.
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Have you traded profitably through crisis market conditions, like Andy has? Which of Imre’s free forex training videos has helped you the most so far?
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