S&P500 index and Shanghai index

Let's look at the two weekly charts above: one is the S&P500 index (500 biggest market caps in USA), the other is the Shanghai index.
The Shanghai index has acted in the past as a leading indicator as China is seen as the economic motor nowadays : it is the country with the highest GDP growth in the world. However this index is now lagging compared to the S&P500 index: the S&P500 is above the 40 week moving average whereas the Shanghai index started going under this moving average 2 weeks ago. This raises a red flag: a price divergence between these two indexes is a concern for any trader.

Citigroup chart analysis

Weekly chart analysis of Citigroup (the "big picture"):
Settings used: the 40 week exponential moving average (equivalent to the 200 day exponential moving average)
For the first time since mid 2007, the price of Citigroup is crossing this moving average to the upside. That's a buy signal for the long term.


Let's now look at the daily chart (to identify when to buy):

Since the bottom of March 2009 (price stood at around $1.0), the price has been making higher lows in July 2009 and February 2010: that's another bullish signal.
Price is now trying to break above the August 2009 resistance at $5.23.
Price is however still in overbought zone: look at the stochastics indicator. So a pullback might be expected over the next few days/weeks.

The fundamentals of Citigroup are improving: it announced on April 19 a net income of $4.43 billion in the last quarter. More info here.

What am I doing? I am already buying some shares now. I will buy more after the price breaks above the resistance of $5.23. My stop is below $3.10 which is the last higher low made in early February. This is a long-term investment: I plan to hold this stock for several years.

Whistleblower Exposes JP Morgan's Silver Manipulation Scheme

Interesting story about Andrew Maguire, a London-based precious metals trader, exposing JP Morgan's silver manipulation scheme to the US Commodity Futures Trading Commission.
Let's see whether the CFTC Enforcement division will decide to start an investigation against JP Morgan.

The next story coming after the SEC vs. Goldman Sachs lawsuit announced last Friday?

Read also this related article.

Gold stocks index

The Amex Gold BUGS Index is a basket of 14 major gold mining companies (Anglogold Ashanti, Barrick Gold, Goldcorp, Kinross Gold, Randgold, Harmony Gold,...). "BUGS" stands for "Basket of Unhedged Gold Stocks". The Index is designed to give investors significant exposure to near term movements in gold prices - by including companies that do not hedge their gold production beyond 1 1/2 years.

On the chart, you can see that gold stocks are trending up and are now nearing the support line. I will be closely watching several gold stocks in the next few days to potentially make some purchases for my portfolio. I will also be watching the price of the Market Vectors Gold Miners ETF (GDX) that tracks gold stocks.

What is interesting to note is that despite the uptrend in the US Dollar index that occurred since early December 2009, the Gold Bugs index has been remarkably resilient, which indicates that the market is still very bullish on gold. A reversal of the uptrend of the USD index would act as a trigger to boost the gold stocks to the upside.

US Dollar index chart analysis

I refer to the post I made regarding the USD index on December 23, 2009, when I gave a buy signal. This buy signal is still valid today as the 20 day moving average is still located above the 50 day moving average. As long as no crossing of these two moving averages occurs, I stay long on the USD index which closed on Friday at 80.79. My target? 86-87.