Thursday, July 22, 2010

Pending Gulf Storm and Stronger Equities Sends Crude Oil Higher

Crude oil closed sharply higher on Thursday over concerns of the pending Gulf storm and spillover strength from the equity markets. Today's rally allowed September to breakout of its sideways trading pattern of the past week and the high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near term. If September extends the rally off this month's low, the reaction high crossing at 79.97 is the next upside target. Closes below last Tuesday's low crossing at 74.70 would temper the near term friendly outlook. First resistance is today's high crossing at 79.42. Second resistance is the reaction high crossing at 79.97. First support is last Tuesday's low crossing at 74.40. Second support is the reaction low crossing at 71.47.

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Natural gas closed higher on Thursday and above the 20 day moving average crossing at 4.579. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near term. Closes above Wednesday's high crossing at 4.662 are needed to confirm that a short term low has been posted. If August resumes the decline off June's high, the reaction low crossing at 4.108 is the next downside target. First resistance is today's high crossing at 4.719. Second resistance is the reaction high crossing at 4.923. First support is the 10 day moving average crossing at 4.479. Second support is last Thursday's low crossing at 4.288.

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The U.S. Dollar closed lower on Thursday and closed below the 10 day moving average crossing at 83.34 as Investors unloaded the Dollar over worries about a sluggish U.S. economic recovery persist and confidence in the euro zone and nations abroad increase. The low range close sets the stage for a steady to lower opening on Friday. Despite today's decline, stochastics and the RSI are turning bullish signaling that a short term low might be in or is near. Closes above the 20 day moving average crossing at 84.22 are needed to confirm that a short term low has been posted. If September resumes the decline off June's high, the 50% retracement level of the November-June rally crossing at 82.15 is the next downside target. First resistance is Wednesday's high crossing at 83.64. Second resistance is the 20 day moving average crossing at 84.22. First support is last Friday's low crossing at 82.25. Second support is the 50% retracement level of the November-June rally crossing at 82.15.

The "Super Cycle" in Gold and How It Will Affect Your Pocketbook in 2010

Gold closed higher amidst increased interest in many commodities after some bullish corporate earnings reports boosted confidence in the economic recovery. August gold continues to consolidate above the 38% retracement level of this year's rally crossing at 1183.90. At the same time, stochastics and the RSI are oversold and turning neutral to bullish hinting that a short term low might be in or is near. Closes above the 20 day moving average crossing at 1210.90 are needed to confirm that a short term low has been posted. If August renews the decline off June's high, the 50% retracement level of the aforementioned decline crossing at 1158.30 is the next downside target. First resistance is today's high crossing at 1201.20. Second resistance is the 20 day moving average crossing at 1210.90. First support is Tuesday's low crossing at 1175.10. Second support is the 50% retracement level of the aforementioned decline crossing at 1158.30.

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