[Premium] Three Charts For The Week Ahead

Last week we focused on First Trust India Nifty 50 Equal Weight ETF, Nifty Small Cap 100 (both in USD and INR) & Equi Weight Metal Top 10.

Let's move into this week's topics. We have big important breakouts to track this week.

1.  The first chart we're looking at is Crude oil in INR. The price is now trading at new all-time highs. There was a clear bullish breakout last week with the price moving past the resistance of 7,785. With this move, the price is now headed towards its next target of 12,100.

Commodities supercycle is something we've been talking about for a while now, but it seems as though it's playing out now.

We are bullish on Crude oil as long as the price trades above the level of 7,785 with a target close to 12,100. But if the price slips below the risk management level, then we will have to make an exit as well.

2. The second chart we're looking at is the Dollar Index. The market is having to factor in a lot of swift movements quickly, and this is one of them. The Dollar Index has been gaining strength and is now trading above the level of 97.75. With this breakout, the Dollar is now trading close to its two-year highs.

Of course, strength in the Dollar acts as a headwind for stocks and commodities. But both asset classes have winners and losers alike. So there are places in the market to remain invested in and places to get an exit as well.

We are bullish DXY above the level of 97.75, with a target close to 103. There is a minor resistance at 100.50 as well and it would be interesting to see how the price reacts around that level. But DXY is definitely an important piece of the puzzle to track.

3. Look who finally showed up, the third chart is Copper! For the longest time, we've seen other base metals outperform Copper consistently while Copper moved sideways. And the one narration we were sticking to constantly, was that if Copper wasn't giving away even in times of a market correction, then that's a crucial signal.

Looks like that signal is making itself visible now. The price closed with a strong bullish candlestick above the level of 814 after almost a year of a sideways move. With this breakout, Copper has joined the other base metals in their attempt to move out of trading ranges and resume the prior bullish trend.

The bullish thesis is valid so long as Copper trades above the level of 814, with a target close to 1,095.

If Copper gets going, then the Base Metals could really take off to new highs here. This is a very important chart to track.

In our view, these charts will help set the tone for this week and provide us with information on how we should approach the market in the coming weeks.

Also, make sure to check out our other weekly post, "Trade Of The Week."

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team