Tuesday, December 6, 2011

Crude Oil Bulls Take The Advantage Into Wednesday Trading

Crude oil closed higher on Tuesday as it extends the rally off the November 25th low. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. If January renews the rally off October's low, the 75% retracement level of the May-October decline crossing at 105.42 is the next upside target. Closes below the reaction low crossing at 94.99 are needed to confirm that a short term top has been posted. First resistance is the 75% retracement level of the May-October decline crossing at 105.42. Second resistance is the 87% retracement level of the May-October decline crossing at 110.46. First support is the reaction low crossing at 94.99. Second support is the reaction low crossing at 89.05.

Gold closed slightly higher on Tuesday as it consolidated some of Monday's decline. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near term. If February extends the rally off November's low, November's high crossing at 1806.60 is the next upside target. Closes below November's low crossing at 1670.50 would renew the decline off November's high. First resistance is last Friday's high crossing at 1767.10. Second resistance is November's high crossing at 1806.60. First support is November's low crossing at 1670.50. Second support is the reaction low crossing at 1607.30.

Natural gas closed higher due to short covering on Tuesday but not before spiking to a new contract low. Stochastics and the RSI are diverging but are turning bearish signaling that sideways to lower prices are possible near term. If January extends this year's decline, monthly support crossing at 3.225 is the next downside target. Closes above the reaction high crossing at 3.720 are needed to confirm that a short term low has been posted. First resistance is the reaction high crossing at 3.720. Second resistance is the reaction high crossing at 4.095. First support is today's low crossing at 3.405. Second support is monthly support crossing at 3.225.

Gold’s 4th Wave Consolidation Nears Completion and Breakout

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