Wednesday, July 7, 2010

Commodities Commentary For Wednesday Evening

Crude oil closed higher due to short covering on Wednesday as it consolidated some of the decline off June's high. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are oversold but are neutral to bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, the reaction low crossing at 70.93 is the next downside target. Closes above the 20 day moving average crossing at 76.30 would confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 75.28. Second resistance is the 20 day moving average crossing at 76.30. First support is Tuesday's low crossing at 71.09. Second support is the reaction low crossing at 70.93.

Natural gas closed lower on Wednesday and the low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are neutral to bullish hinting that a short term low might be in or is near. Closes above the 20 day moving average crossing at 4.841 are needed to confirm that a short term low has been posted. If August resumes last week's decline, the reaction low crossing at 4.285 is the next downside target. First resistance is the 20 day moving average crossing at 4.841. Second resistance is June's high crossing at 5.249. First support is last Wednesday's low crossing at 4.477. Second support is the reaction low crossing at 4.285.

The U.S. Dollar closed lower on Wednesday as it extends the decline off June's high. The low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near term. If September extends the aforementioned decline, the 38% retracement level of the November-June rally crossing at 83.83 is the next downside target. Closes above the 20 day moving average crossing at 85.94 are needed to confirm that a short term low has been posted. First resistance is the 10 day moving average high crossing at 85.30. Second resistance is the 20 day moving average crossing at 85.94. First support is Tuesday's low crossing at 84.04. Second support is the 38% retracement level of the November-June rally crossing at 83.83.

Gold closed higher due to short covering on Wednesday as it consolidates some of the decline off June's high. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If August extends the aforementioned decline, the 38% retracement level of this year's rally crossing at 1183.90 is the next downside target. Closes above the 20 day moving average crossing at 1231.60 would signal that a short term low has been posted. First resistance is the 10 day moving average crossing at 1227.60. Second resistance is last Wednesday's high crossing at 1248.80. First support is today's low crossing at 1185.00. Second support is the 38% retracement level of this year's rally crossing at 1183.90.

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