The Overall Technical Outlook
Gold's rebound last week was capped at 1681.3 and faded. With 4 hrs MACD crossed below signal line, initial bias is mildly on the Southside this week.
Also, with, 1696.9, Key resistance intact, the term outlook remains Bearish and the fall from 1792.7 is expected to resume sooner or later. A clear break of 1613 will target 1523.9 and possibly lower IMO.
The Big Picture: Gold price actions from 1923.7 high are still viewed as a medium term consolidation pattern. The fall from 1792.7 is viewed as a falling leg inside the pattern, and should head back to 1478.3-1577.4, the Support Zone. That said I still expect strong support at 1478.3-1577.4, the Support Zone to contain any Southside action and finish the consolidation, bringing on a up-trend resumption to another high but above 1923.7.
On the Upside: a clear break of 1696.9, the Key resistance will augur that the fall from 1792.7 is finished and turn the focus back to this resistance mark instead.
The Long Term Picture: with 1478.3 support intact, there is no change in my long term Bullish outlook for Gold. Though some more medium term consolidation cannot be ruled out, I anticipate an eventual break of 2000 psych mark in the long term. Stay tuned...
Silver has been indecisive recently but my near term outlook remains Bearish with 33.29, the Key resistance intact. The fall from 37.475 is expected to continue lower to 61.8% fibo retracement of 26.145 to 37.48 at 30.513. Sustained trading below 30, the psych mark, should show the way to 26.145 and below.
The Big Picture: Silver's price actions from 26.15 should be considered a consolidation pattern only and has completed with 3 waves to 37.48. The fall from there is tentatively treated as resumption of the medium term decline from 49.82, the high, and should extend through 26.145 to 61.8% fibo retracement of 8.4 to 49.82 at 24.22 and below. But, a clear break of 33.29, the Key resistance, dampens this POV, and turns the focus back to 37.48.
The Long Term Picture: the Big Q remains on whether 49.82 is a medium term or long term Top. This current action favors the latter. Though, I would prefer to see sustained break of 61.8% fibo retracement of 8.4 to 49.82 at 24.22 to confirm. Barring that the price action from 49.82 could just be developing into a sideway pattern. Stay tuned...
Nymex Crude Oil
Despite falling to 100.68, Crude Oil drew support from its 61.8% fibo retracement of 95.44 to 110.55 at 101.21 and recovered.
The initial bias this week is Neutral with focus back on 105.49, the minor resistance. A clear break there will indicate that choppy correction from 110.55 is finished and will turn the bias back to the Northside.
Also this will confirm the Bullish case that the rise from 74.95 is not over, and will bring retest of 110.55 1st. But, another break of 100.68 will now have a Bearish implication and should turn focus back to 95.44, the Key support mark instead.
The Big Picture: Crude Oil's price actions form 114.84 are treated as a correction, and should have completed at 74.95. The rise from there is tentatively viewed as resumption of the medium term up-trend from 33.2. A clear break of 114.83 targets the 61.8% fibo projection of 33.2 to 114.83 from 74.95 at 125.40.
On the Downside: a break of 95.44, the Key support, indicates that the correction pattern from 114.83 is going to extend further with another falling leg to 74.95 and below before finishing.
The Long Term Picture: Crude Oil is in a long term consolidation pattern from 147.27, with the 1st wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it is the 2nd wave of the consolidation pattern. While it could make another high above 114.83, I believe that the strong resistance ahead of 147.24 will bring on a reversal for the 3rd leg of the consolidation pattern. Stay tuned...
Nymex Nat Gas
Natural gas's downtrend extended further last week and broke 2.0 psychological level. Downside momentum is a bit unconvincing with 4 hours MACD crossed above signal line. But after all, bear term outlook remains bearish as long as 2.126 minor resistance holds. Current decline could extend to 100% projection of 2.733 to 2.204 from 2.38 at 1.851 next.
The Big Picture: the medium term fall from 4.93 is still in progress and there is no sign of bottoming yet IMO. Nat Gas is possibly building up Southside momentum again with daily MACD staying below the signal line, trending down. Sustained trading below 2.0 psych mark should show the way to 61.8% fibo projection of 3.978 to 2.231 from 2.742 at 1.662 next.
On the Upside: a clear break of 2.231, the Support turned Resistance is need as the 1st sign of bottoming. Barring that I am Bearish Nat Gas even in case of a recovery.
The Long Term Picture: the whole downtrend from 13.694, the Y 2008 high, is still in progress, so is that from 15.78, the Y 2005 high. The monthly MACD's stay below Signal Line suggest that downside momentum is increasing. Current fall would target Y 2002 low of 1.96 and below. Stay tuned...
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.