Wednesday, November 24, 2010

SP 500, Crude Oil, Natural Gas, Gold and U.S. Dollar Commentary For Wednesday Evening Nov. 24th

The S&P 500 index closed higher due to short covering on Wednesday as it consolidated some of Tuesday's decline. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are neutral to bullish signaling that a short term low might be in or is near. Closes above Monday's high crossing at 1206.00 would temper the near term bearish outlook. If December renews the decline off this month's high, the 25% retracement level of the July-November rally crossing at 1169.37 is the next downside target. First resistance is Monday's high crossing at 1206.00. Second resistance is this month's high crossing at 1224.50. First support is last Tuesday's low crossing at 1175.20. Second support is the 25% retracement level of the July-November rally crossing at 1169.37.

Crude oil closed sharply higher on Wednesday as it rebounds off the 50% retracement level of the August-November rally crossing at 81.14. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are oversold and turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 84.53 are needed to confirm that a short term low has been posted. If January extends this month's decline, the 62% retracement level of the August-November rally crossing at 79.24 is the next downside target. First resistance is today's high crossing at 83.95 Second resistance is the 20 day moving average crossing at 84.53. First support is Tuesday's low crossing at 80.28. Second support is the 62% retracement level of the August-November rally crossing at 79.24.

Natural gas closed lower due to profit taking on Wednesday as it consolidates some of the rally off last week's low. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. If January extends the rally off October's low, the 38% retracement level of the June-October decline crossing at 4.654 is the next upside target. Closes below the 20 day moving average crossing at 4.196 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 4.515. Second resistance is the 38% retracement level of the June-October decline crossing at 4.654. First support is the 20 day moving average crossing at 4.196. Second support is this month's low crossing at 3.853.

Gold closed lower due to profit taking on Wednesday as it consolidates some of the rally off last week's low. The mid range close sets the stage for a steady opening on Friday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. If December extends the rally off last week's low, the reaction high crossing at 1388.10 is the next upside target. If December renews this month's decline, the reaction low crossing at 1315.60 is the next downside target. First resistance is Tuesday's high crossing at 1382.90. Second resistance is the reaction high crossing at 1388.10. First support is last Tuesday's low crossing at 1329.00. Second support is the reaction low crossing at 1315.60.

The U.S. Dollar closed higher on Wednesday as it extends this month's rally. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought, diverging but are bullish again signaling that sideways to higher prices are possible near term. If December extends this month's rally, the 38% retracement level of this year's decline crossing at 80.54 is the next upside target. Closes below the 20 day moving average crossing at 78.03 would confirm that a short term top has been posted. First resistance is today's high crossing at 80.09. Second resistance is the 38% retracement level of this year's decline crossing at 80.54. First support is the 20 day moving average crossing at 78.03. Second support is this month's low crossing at 75.24.


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