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In One Chart
Stock-market bottom or ‘very tough times ahead’?
Here’s what one chart watcher is keeping his eye on
Published: April 3, 2020 at 3:44 p.m. ET
By
William Watts
Commodities index ‘will go miles and miles’ toward telling us if we are headed for tough times, says Kimble
Investors say there’s no one chart that will signal when the stock-market bottom is in. But technical analyst Chris Kimble argued Friday that an important tell could be offered by a commodity index that is testing a support level that has held for the past 40 years.
![[Bild: MW-ID737_commsK_20200403110602_NS.jpg?uu...8e992d421e]](https://ei.marketwatch.com/Multimedia/2020/04/03/Photos/NS/MW-ID737_commsK_20200403110602_NS.jpg?uuid=a2276ea4-75bc-11ea-8f02-9c8e992d421e)
In a Friday blog post, the founder of Kimble Charting Solutions pointed to the chart above for the Thomson Reuters Equally Weighted Commodities Index, which he said “will go miles and miles towards telling us if we are headed towards very tough times or if the huge declines of late are actually in a bottoming process.” The chart tracks the index on a monthly basis back to 1954.
The index tracks a basket of 17 commodities, including cocoa, coffee, copper, corn, soybeans, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, platinum, silver, soybean oil, sugar and wheat.
The index has been headed south over the last nine years, reflecting general weakness in commodities, Kimble noted. In 2009, a then-29-year-old support level held, indicating that the worst of the financial crisis was priced in. It’s testing that level again now.
“If the index holds at 2009 support, it would suggest that lows are in play and the worst has already been priced into the markets,” he said. “If the index breaks this 40-year support/resistance line, it would suggest that some really tough times are ahead!”
https://www.marketwatch.com/story/market...extup_bomw
Stock-market bottom or ‘very tough times ahead’?
Here’s what one chart watcher is keeping his eye on
Published: April 3, 2020 at 3:44 p.m. ET
By
William Watts
Commodities index ‘will go miles and miles’ toward telling us if we are headed for tough times, says Kimble
Investors say there’s no one chart that will signal when the stock-market bottom is in. But technical analyst Chris Kimble argued Friday that an important tell could be offered by a commodity index that is testing a support level that has held for the past 40 years.
In a Friday blog post, the founder of Kimble Charting Solutions pointed to the chart above for the Thomson Reuters Equally Weighted Commodities Index, which he said “will go miles and miles towards telling us if we are headed towards very tough times or if the huge declines of late are actually in a bottoming process.” The chart tracks the index on a monthly basis back to 1954.
The index tracks a basket of 17 commodities, including cocoa, coffee, copper, corn, soybeans, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, platinum, silver, soybean oil, sugar and wheat.
The index has been headed south over the last nine years, reflecting general weakness in commodities, Kimble noted. In 2009, a then-29-year-old support level held, indicating that the worst of the financial crisis was priced in. It’s testing that level again now.
“If the index holds at 2009 support, it would suggest that lows are in play and the worst has already been priced into the markets,” he said. “If the index breaks this 40-year support/resistance line, it would suggest that some really tough times are ahead!”
https://www.marketwatch.com/story/market...extup_bomw
