Wednesday, October 20, 2010

Stock Market and Commodities Commentary For Wednesday Evening Oct. 20th

The U.S. stock indexes closed solidly higher today and saw Tuesday's losses quickly erased. The stock index bulls still have the overall near term technical advantage as price uptrends are still in place on the daily bar charts. Stock index bulls have been very pleased with price action so far this autumn, a time which is normally not favorable to market bulls. My bias is that prices will trade mostly sideways, but with a slight upside bias, into the end of the year.

Crude oil closed up $2.28 at $82.44 a barrel today. Prices closed near the session high today after hitting a fresh three week low early on. Sharp losses in the U.S. dollar index and higher stock index future prices today boosted crude.

Natural gas closed up 0.8 cents at $3.903 today. Prices closed near mid range today and saw tepid short covering in a bear market. Prices hit a fresh contract low this week. The bears still have the solid overall near term technical advantage.

Gold futures closed up $9.10 at $1,345.10 today. Prices closed nearer the session high and were supported by a sharply lower U.S. dollar index. Bargain hunters once again stepped in to buy weakness in the gold market, to now suggest Tuesday's low is just another "reaction low" in an overall 2 1/2 month old uptrend on the daily bar chart. Bulls have the overall near term and longer term technical advantage.

The U.S. dollar index closed down 100 points at 77.41 today. Prices closed near the session low today and quickly gave back most of Tuesday's big gains. Dollar index bears still have the overall near term technical advantage and regained some downside momentum today.

Today’s Stock Market Club Trading Triangles

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