A Stock Market Crash Shield Shines with Gold and Silver 1 OZ 999 NY (XAG=X)
A stock market crash shield in the colors of gold and silver shines brightly as investors increasingly seek to buy those precious metals to profit when stocks sink.
The importance of having investments that tend to climb when equities fall cannot be overstated during times such as now when major U.S. stock indexes plunge. People searching for a stock market crash shield can use precious metals for protection amid the ongoing crisis caused by the deadly coronavirus, also known as COVID-19.
Gold and silver, real estate investment trusts (REITS), investment-grade corporate bond funds and fixed indexed annuities are among the investments typically favored by those who want to own assets that are not closely correlated with major equity indexes. The inverse relationship between precious metals and equities manifested itself during March 9, when the market endured its biggest drop since September 29, 2008 as gold gained, and on March 10, when stocks soared and gold retreated.
Also on March 10, President Trump talked to Republican lawmakers in Congress about offering a broad fiscal stimulus package that would include a payroll tax cut, an infrastructure funding plan, paid sick leave for hourly workers and a possible delay of estimated tax payments for some Americans. Even though passage could be daunting, just floating the ideas may have helped to lift the market.
A plunge in gold prices on Friday, Jan. 28, on the same day as drops in the Dow Jones Industrial and in the S&P 500, should not raise alarms for anyone, even though gold usually jumps when equities dive, Checkan told me.
Gold slid that day due to week-long downward pressure on stock prices that caused investors who borrow money for trading to sell the precious yellow metal to cover their margin accounts, Checkan continued. In such instances, an investor who takes out a $100,000 loan to double his available funds to $200,000 in hopes of earning twice the amount of profit must find an immediate source of cash to cover his leveraged position.
Many investors are willing to take the risk to pursue the potential reward of doubling their returns.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 17.56.
The projected upper bound is: 17.52.
The projected lower bound is: 15.92.
The projected closing price is: 16.72.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 31.5706. This is not an overbought or oversold reading. The last signal was a buy 6 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 36.92. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 45 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -75. This is not a topping or bottoming area. The last signal was a buy 5 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 9 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAG= closed down -0.117 at 16.743. Volume was 8,900% above average (trending) and Bollinger Bands were 94% wider than normal.
Open High Low Close Volume___
16.872 17.104 16.730 16.743 34,099
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 17.07 17.75 17.11
Volatility: 42 29 27
Volume: 3,410 682 170
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAG= is currently 2.2% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect very strong flows of volume out of XAG= (bearish). Our trend forecasting oscillators are currently bearish on XAG= and have had this outlook for the last 8 periods.