Top And Worst Asset Performers For The Week Of 5/11/20

Intermarket analysis is a powerful tool that gives traders/investors a macro predictive direction of stocks, bonds, commodities and currencies. Intermarket analysis states that all asset classes are interrelated and that you can’t definitively determine the direction of one asset class without examining the other asset classes.

There are several key relationships that bind these four markets together. These relationships include:

The INVERSE relationship between commodities and bonds.
The INVERSE relationship between bonds and stocks.
The POSITIVE relationship between stocks and commodities.
The INVERSE relationship between the US Dollar and commodities.

The overall goal of the intermarket analysis is to identify top performers or the markets that are outperforming others. With all that said, the top and worst performers from this past week are the following:

Top Performers

Crude Oil WTI: +7.58%

Despite oil prices still being down more than 50% this year, oil is higher for the third straight week and price is at the highest level since mid-March as economies around the world begin to reopen and signs continue to emerge that demand is recovering.

Gasoline RBOB: +6.12%

The daily chart is suggesting to go long on a pull back to the daily demand at $0.7320 with a target just below the daily supply.

Platinum: 5.92%

Worst Performers

Class III Milk: -1.92%

Natural Gas: -1.96%

Natural gas markets have initially tried to rally a bit during the trading week, but then broke down significantly towards the $1.60 level before showing signs of support. All things being equal, it is highly likely that we will go looking towards the lower levels, where buyers will come back into play. Quite frankly, it looks as if the natural gas market is trying to form some type of “broadening pattern”, which quite often can lead to a trend change. Having said that, there is still extraordinarily large amount of bearish pressure in this market and I do not think that is going to change quickly.

Bankruptcies in North America will help the natural gas markets, could send this market towards the upside as supply dwindles a bit but the demand part of the equation will continue to be a major problem.

Source

Bitcoin CME Futures: -3.34%

This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.