Energy Sets Up Near Major Resistance - Breakdown Pending

Our research team believes Crude Oil and Energy, in general, has stalled near major resistance and maybe setting up a big downside move as the COVID-19 virus continues to roil regional and global economies.

The recent news that the COVID-19 virus cases have skyrocketed suggests further economic shutdowns may push oil prices below $35 ppb over the next few weeks and months. Our researchers believe Oil has already set up a resistance level near $42 and will begin to move lower as concerns about the economic recovery transition through expectations related to oil demand going forward. We believe the renewed global economic demand for oil will present a very real possibility that oil could collapse below $35 ppb over the next 30 days.

We believe this pending downside move in Crude Oil will set up a great trade opportunity in ERY, the Direxion Bear Energy 2x ETF. At this point in time, we are just waiting for the technical confirmation of this trade trigger. Once we receive confirmation from our price modeling systems, we believe ERY may rally 20% to 30% or more from current levels....Continue Reading Here.

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Seven Year Cycles Can Be Powerful and Gold Just Started One

Our research and predictive modeling systems have nailed Gold over the past 15+ months. We expected Gold to rally above $1750 before the end of this year, but the global trade wars and news cycles stalled the rally in Gold over the past 2 months. Now, it appears Gold is poised for another rally pushing much higher.

But wait, if you’re thinking I’m just another one of those traders who is always bullish on gold, just know I have been telling the truth about where gold was headed (lower) for years, but finally, the tide has changed!

Gold broke down from a bull market in 2012/2013 – nearly 7 years ago. Now, Gold has broken resistance near $1375 and is technically in a full fledged Bull Market. The importance of this is the seven year cycle and how the rotation in Gold, between the high near $1923 and the low near $1045 represent an $878 price range. The upside (expansion) rally in Gold may very well move in expanding Fibonacci price structures – just like it did in 2005 through 2012. If this is the case, then we may expect to see an ultimate peak price in Gold well above $3500.

The rally that started in the last 2015 and ended in July 2016 totaled +$331.1 (+31.67%). The next price rally that started in August 2018 and ended in September 2019 totaled +$399.4 (+34.22%). If we take the current rally range (399.4) and divide it by the previous rally range (331.1), we end up with an expansion range of 121%. The two unique rallies that happened just before the 2009 parabolic rally in Gold represented (+315.8: 2006) and (394.8: 2008). The ratio of these two rallies is 125%. Could Gold have already set up for another parabolic rally well beyond the $1923 target level?

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Monthly Price of Gold Chart – Bull and Bear Market Trends

Our research team believes Gold has already entered a technically valid Bullish Market trend. We believe Gold miners will follow higher as Gold begins this next move higher. The reason we have not engaged in Miners, yet, is because we have not received any technically valid signals related to the Gold miners indicating they have also entered a new Bullish Market trend.

Gold is the safe haven for the global market. It is a store of value and offers price appreciation when the global market risks are excessive. Because of this, the sentiment across the global markets appears to be weakening in regards to forward expectations and valuation appreciation within the investment/asset classes. If Gold continues to rally higher, consider it a strong indicator that the foundation of the global market valuation levels is weakening considerably.

U.S. Dollar Will Start to Support Higher Gold Prices

Should the U.S. Dollar retrace lower, Gold will see a price increase based on the renewed weakness of the U.S. Dollar. This would also assist in re-balancing global trade and economic issues with the US Dollar moving moderately lower as weakening global markets contract.

Gold Mining Stocks – Monthly Chart

Miners are set up much like Gold was in early 2018. Resistance has been set up with multiple price tops and any momentum rally above this level would technically qualify as a new Bullish Market trend for miners.

At this point, we believe the bottom in miners has already formed and we are simply waiting for the qualifying technical confirmation of the bullish trend to begin. Jumping into this trade too early could result in unwanted risks as the price could still waffle around within the Stage 1 Base range.

If you want to learn more about market stage analysis I will be covering it a new article shortly. Once you grasp the basic concept you will see these stages on every chart no matter the time frame and know when to focus on trading and when to ignore the charts.

If you like new fresh big trend trades then check out this real estate article I just posted and how the real estate ETF could allow your to profit from home prices but you don’t even need to own or buy a home!

Concluding Thoughts

The recent weakness in the US and global markets has prompted a moderately solid upside move in Gold and Silver over the past few days. We still need to see a Gold move above recent resistance to qualify as a new upside rally though. Miners are set up for a breakout technical move which we must also wait for. We believe these two may move somewhat in unison if the global markets continue to contract throughout the end of 2019 and into 2020.

Stay tuned for more updates and alerts when all these key sectors and asset classes start new trends because that is when you want to get involved for immediate oversized gains. See my stock, index, and commodity trade alerts here.

Chris Vermeulen
The Technical Traders

Natural Gas and Crude Oil Diverging Setups for Technical Traders

Over the past few weeks and months, we’ve been alerting our followers to the incredible setups in Natural Gas and Crude Oil. If you’ve been following our research, you already know on May 21st we called for Oil to break down from $62 level with a target of $55 then $49 price levels.

We’ve been alerting that Natural Gas was setting up an incredible seasonal trade with a move that was likely to push lower into the $2.00 to $2.20 level – suggesting any move into this range would be a solid buying opportunity for the seasonal upside move. Well, here we are about 35 days later and look at what happened.

Crude Oil Weekly Chart

The US/China trade issues and global economic turmoil is taking a toll on Crude Oil. Price rotated downward very sharply last week with an incredible -8% downside move in one day. Currently, price is resting just above the Moving Average and should soon breakdown below this level towards the $49 price level. At that point, price should stall, briefly, before attempting to find support below $50.

Our Fibonacci price modeling system suggests true support is found near $45 and $40. Be prepared for a potential downside move of -20% to -25% from current levels.

Natural Gas Weekly Chart

Natural Gas has done exactly what we expected. On this Weekly chart, you can see our shaded BLUE support range area and our GREEN and RED arrows from months ago highlighting what we expected to happen in price. Yes, price is lower than we currently expected, but it has aligned with our expected price rotation almost perfectly.

At this point, the sub $2.20 level is a perfect opportunity for skilled technical traders to prepare for the seasonal trend that will push Natural Gas back above the $2.65 to $3.15 level. Allow us to go through our expectations with you so you understand how to plan for and trade this move.

August is typically moderately bearish for NG. So expect to try to pick your entry for this trade in August. The ratio of bearish price activity in August is 1.2x the bullish price activity.

September is STRONGLY BULLISH – with an upside ratio of 10x compared to historical downside price activity. September is where we should see a big upside price move.

October is still STRONGLY BULLISH – with an upside ratio of 3x compared to historical downside price activity.

November is moderately bullish with a 1.3x upside ratio compared to downside price activity.

Video – Todays Market Analysis SPX, Bonds, Gold, Crude Oil, Natural Gas

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CONCLUDING THOUGHTS

This means two things. First, Crude Oil should continue to breakdown and target the $49 price level over the next few days and weeks while Natural Gas sets up an incredible upside price setup below $2.25 for skilled technical traders. Oil is moving lower because of lower demand related to the global economic slowdown and larger supply issues. Natural Gas is setting up a seasonal pattern that could become a fantastic trading opportunity for traders that time their entries and understand the setup. In late August or early September price should begin to rally well above $2.50 with an ultimate upside target of well above $3.00.

In short, if you want to know what the market is going to nearly every day and get my trade alerts complete with entry, targets and stop prices join my Wealth Building Newsletter here at The Technical Traders.

Chris Vermeulen
The Technical Traders

Transportation Index Warns of Trouble Ahead

Any weakness in the Transportation Index near current levels would indicate investors and traders believe the global economy may continue to contract going forward and may be an ominous sign for the global stock markets.

The Transportation Index is a measure of the current expectations related to shipping, trucking, trains and all measure of forward expectations for goods, products and raw materials to be moved across nations, seas, states, and locations. When the economy is gaining strength, we typically expect to see the Transportation Index moving higher. When the economy is weakening, we typically expect to see the Transportation Index moving lower.

Since the peak in September 2018, the Transportation Index has moved much lower to establish a base near $8625 in December 2018. After that base formed, a series of price rotations pushed the Transportation Index up to $11,148, where it peaked, then began to trail a bit lower since May 2019. Our concern is that the Support/Resistance level, highlighted by the GREEN rectangle on this Weekly chart, represents a critical historical price that must be breached before any renewed strength in the global markets will be seen.

After the G20 meeting, last weekend, and the rally in the U.S. stock market on Monday, we were a bit surprised that the Transportation Index failed to move dramatically higher following the global markets. This leads us to believe investors were taking advantage of a pricing issue related to the G20 and US/China trade war news that was not rooted in strength seen in the global economy. In other words, buy the rumor, sell the news. It would appear the rumor hit the markets Sunday in Tokyo and the news hit the U.S. markets on Monday.

We talked about the G20 meeting results and how G20 will move gold and the U.S. stock indexes.

Skilled technical traders already know we must be cautious near these current all time highs. Volatility can increase dramatically on news or other earnings data which may drive prices higher or lower over the next few weeks. As we start July (Q3) 2019, we should be preparing for earnings data to be released over the next 30+ days as well as continued news related to global trade issues. Additionally, the items which will be sold for Christmas and the holidays are already being shipped across the globe and being distributed to warehouses over the next few months prior to the start of the holiday season.

Historically, July through September are somewhat weak for the Transportation Index. Overall, the Transportation Index loses approximately 500 to 600 points over this 90 day span with a range (potentially) of over $3000 points in volatility. Bullish trending strength returns in October and November where the Transportation Index typically rallies approximately $5000 pts with a volatility range of about $7000 points. These historical trends suggest we could see quite a bit of volatility over the next 90 days with a decent chance at seeing a downward price move targeting recent December 2018 lows.

Concluding Thoughts

In previous articles, we’ve suggested a simple trade setup technique we use to identify entry and exit points – the 100% Fibonacci Extension Move. If this move holds true for the Transportation Index, then a move to levels near $8250 is about to unfold based on the move from Sept 2019 to Dec 2019. It would make sense that this move would likely happen between now and September 2019 – followed by a solid rally into the end of 2019 as our historical data suggests.

Now is the time to stay on top of these moves and to target the opportunity these bigger price rotations provide for technical traders. Simply put, we have just described a downside price move of about $2000 points in the Transportation Index followed by an upside price move of over $4000 to $5000 points. You don’t want to miss this one, folks.

I can tell you that huge moves are about to start unfolding not only in real estate, but metals, stocks, and currencies. Some of these super cycles are going to last years. Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye opener. PDF guide: 2020 Cycles – The Greatest Opportunity Of Your Lifetime

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short term swing trading and long term investment capital. The opportunities are massive/life changing if handled properly.

I urge you to visit my Wealth Building Newsletter and if you like what I offer, join me with the 1 or 2 year subscription to lock in the lowest rate possible, get a FREE BAR OF GOLD and ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next set of crisis’.

Chris Vermeulen
The Technical Traders

The SP500 Breaks 2018 February Lows - What Next?

The ES (S&P e-mini contracts) broke the support level from the February 2018 lows immediately after the US Federal Reserve announced a 25 bp rate hike this week. This breakdown below the February 2018 lows is concerning because it indicates that previous support is not holding and we could be in for further downside price activity.

We are preparing a detailed research post for early next week regarding a broad range of US markets as well as how our proprietary price modeling systems are reflecting this recent price move. What we can suggest to all investors is play small positions at the moment and prepare for increased volatility. There is near term support that may come into play soon, but overall the markets are reacting to a deleveraging event that could see prices push below 2400 before finding true support.

Visit The Technical Traders to read all of our recent research posts and see what we believe will be the big movers in 2019.

Chris Vermeulen

Gold Extends Consolidation Giving Silver Another Chance

Gold and silver exchange leading roles in the market quite often, especially on the short term charts. Last time I wrote about it silver saved gold from collapse at the start of this month. The white metal unexpectedly bounced off the earlier low reversing the drop of the yellow metal.

This time gold took the lead as its failure to break below the Bear Flag let silver lick its wounds and return above the $14 handle.

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Both metals are still trapped in the middle of the range set by the earlier heavy drop, which first occurred in gold and then it was repeated in the silver market. In this post, I have focused on the local structure as the bigger picture remains unchanged.

The top metal couldn’t break below the trendline support of a Bear Flag (orange) and then quickly restored most of its losses coming back above $1200. It is interesting that the forecasted drop unfolded quite differently in each metal. Silver tagged the earlier trough, but gold failed even to breach the vertically sloped trendline. It looks like strong demand appeared right at the round number of the gold price in the $1200 area.

This move up could build another leg of a prolonged correction, which is labeled as third 3rd (blue line) on the chart. The target for this leg is located on the upside of the trend channel ($1260-$1270), and it perfectly matches with the earlier top established this July. It is worth to mention that the triple legged corrections are not as regular as simple AB/CD double leg moves.

Currently, gold shows signs of a minor correction, therefore, I put the Fibonacci retracement levels to highlight the area where the last move up within the 3rd leg up could emerge. This area is located between $1209 and $1213, and it coincides with the trendline support contact point.

The break below $1190 is needed to invalidate the current growth structure.

Silver has a lot of tricks on the chart, and from the very beginning of this horizontal consolidation, I was puzzled to break down the initial structure, although gold has been hinting clearly at the large consolidation in both metals. The main assistant of the trader is time, as more time passes, the chart the structure of the instrument becomes clearer.

As gold didn’t confirm the end of the consolidation, then we should consider the continuation of it for silver as well despite that it retested the earlier low to establish the fresh one at $13.88.

It looks like we got a very complex BC junction, which consists of two counter-trend moves down (small red down arrows). The complexity emerged due to the additional pro-trend (counter-trend relative to red down arrows) sub-junction (small blue up arrows), which let silver synchronize the move with gold as earlier it has been lagging. What was considered to be a second CD leg up, turned out to be a lesser degree CD leg up of a sub-junction. The complexity of the silver chart structure was caused by the unstable nature of the market demand as central banks favor gold, and only cross-market bargain hunters eliminate the excessive miscorrelation.

The second leg (CD segment) up could finally retest the $15 round level to complete this large flat correction. The minor correction that started at the end of last week already hit below the 50% Fibonacci retracement level ($14.21) and could dip further to the $14 round level as gold have more room down for the same minor retracement.

The drop below $13.88 would terminate this leg up.

Aibek Burabayev
Contributor, Metals

Will Crude Oil Find Support Near $60 Dollars

Our research team warned of this move in crude oil back on October 7, 2018. At that time, we warned that oil may follow a historical price pattern, moving dramatically lower and that lows near $65 may become the ultimate bottom for that move. Here we are with a price below that level and many are asking “where will it go from here?”.

We believe the support near $65, although clearly broken, may eventually become resistance for a future upside price move. Our proprietary Fibonacci price modeling system is suggesting a new target near $52.00 - $53.00 and we believe this downside move in crude oil is far from over at this point.

The current global climate for oil is that suppliers are pumping more and more oil into the market at a time when, historically, prices should continue to decline. One of our research tools includes the ability to identify overall bias models for each week, month or quarter. Historically, crude oil is dramatically weaker in the month of November and relatively flat for the month of December.

Analysis for the month of November = 11
    *  Total Monthly Sum : -44.52000000000001 across 36 bars

Analysis for the month of December = 12
    *  Total Monthly Sum : -0.699999999999922 across 36 bars

We believe the price of oil will continue to drift lower to target the $52.00 - $53.00 Fibonacci support level before attempting to find any real price support. This equates to an addition -6 to -8% price decline for skilled traders. We will alert you with a new research post as this downward price move continues or new research becomes available.

We have been calling these types of market moves all year and recently called the top in the U.S. equity markets nearly 40 days before it happened. Want to know what we think is going to happen for the rest of 2018 and into early 2019? Visit the Technical Traders Free Research to read all of our public research posts. Isn’t it time you invested in a team of researchers and tools to assist you in finding greater trading success?

Chris Vermeulen

Webinar Replay...Low Risk Setups For Trading Precise Turning Points in Any Market

On September 6th John Carter of Simpler Options treated us to a special online training webinar. We discovered low risk option strategies for catching "bold and beautiful" reversal trades. John also showed us how to hunt for tops and bottoms using low risk setups for trading precise turning points in any market and so much more.

Watch the FREE Replay Here

Most traders have no idea how to capture the massive profit potential from trading major reversals. These days’ markets often turn on a dime and those who wait for ‘conservative’ setups either miss out or suffer steep losses.

Here's what you can expect to learn during this webinar session....

  *  A simple 3-step process to identify major market turning points in any market

  *  How to find low risk, high probability trades in today's volatile market conditions

  *  Why it’s finally possible to catch tops and bottoms in real time on almost any chart

  *  Why these ‘Bold and Beautiful’ reversal trades can be safer than ‘comfortable’ trades

  *  How to avoid getting suckered into the costly traps that most traders fall into

  *  How to adapt your trades automatically for choppy conditions AND big trends

  *  How to know when a support or resistance level is likely to hold or not


       Watch the FREE replay Right Here


       See you in the markets,
       Ray Parrish
       aka the Crude Oil Trader


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Mid Week Market Summary - Crude Oil, Natural Gas, Gold

November crude oil closed higher on Wednesday. The high range close sets the stage for a steady to higher opening when Thursday's night session begins. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 95.07 are needed to confirm that a low has been posted. If November resumes the decline off June's high, the 50% retracement level of the 2009-2011 rally crossing at 85.77 is the next downside target. First resistance is last Tuesday's high crossing at 94.12. Second resistance is the reaction high crossing at 95.07. First support is is the 38% retracement level of the 2009-2011 rally crossing at 90.75. Second support is the 50% retracement level of the 2009-2011 rally crossing at 85.77.

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November natural gas closed higher on Wednesday as it consolidated some of the decline off last week's high. The high range close sets the stage for a steady to higher opening when Thursday's session begins trading. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the late August high crossing at 4.163 are needed to confirm an upside breakout of the late summer trading range. If November extends the decline off last week's high, July's low crossing at 3.786 is the next downside target. Closes below July's low crossing at 3.786 would confirm a downside breakout of the late summer trading range. First resistance is last Wednesday's high crossing at 4.100. Second resistance is the late August high crossing at 4.163. First support is the reaction low crossing at 3.812. Second support is July's low crossing at 3.786.

Here's Proof You Are Trading Like a Drooling Dog

December gold closed lower on Wednesday. The low range close sets the stage for a steady to lower opening when Wednesday's night session begins trading. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If December extends the decline off July's high, the December 2013 low crossing at 1185.00 is the next downside target. Closes above the 20 day moving average crossing at 1247.90 are needed to confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 1228.00. Second resistance is the 20 day moving average crossing at 1247.90. First support is Monday's low crossing at 1208.80. Second support is the December 2013 low crossing at 1185.00.

Make sure to get our new eBook "Understanding Options"....Just Click Here!

Mid Week Market Summary - Crude Oil, Natural Gas, Gold, Wheat and Coffee

Crude oil closed sharply higher on Wednesday and above the 10 day moving average crossing at 93.53 signaling that a low might be in or is near. Today's high range close sets the stage for a steady to higher opening when Thursday's night session begins. Stochastics and the RSI are oversold but are 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 96.25 are needed to confirm that a short term low has been posted. If March resumes the decline off December's high, the June 2013 low crossing at 89.48 is the next downside target. First resistance is today's high crossing at 94.82. Second resistance is the 20 day moving average crossing at 96.25. First support is last Thursday's low crossing at 91.47. Second support is the June 2013 low crossing at 89.48.

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Natural gas closed lower on Wednesday as it consolidates some of the rally off last week's low. The low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If March extends the aforementioned rally, the reaction high crossing at 4.403 is the next upside target. Closes below the 10 day moving average crossing at 4.213 would confirm that a short term top has been posted. First resistance is the reaction high crossing at 4.403. Second resistance is December's high crossing at 4.550. First support is the 10 day moving average crossing at 4.213. Second support is last Friday's low crossing at 3.936.

Gold closed lower due to profit taking on Wednesday as it consolidated some of the rally off December's low. The high range close sets the stage for a steady to higher opening when Thursday's night session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If April extends the rally off December's low, December's high crossing at 1266.70 is the next upside target. Closes below the 20 day moving average crossing at 1223.90 would confirm that a short term top has been posted. If April renews the decline off August's high, weekly support crossing at 1179.40 is the next downside target. First resistance is Tuesday's high crossing at 1255.20. Second resistance is December's high crossing at 1266.70. First support is the 20 day moving average crossing at 1223.90. Second support is December's low crossing at 1182.30.

Coffee closed lower on Wednesday and the mid range close set the stage for a steady opening on Thursday. Stochastics and the RSI are diverging and are turning neutral to bearish signaling that sideways to lower prices are possible near term. Closes below the 20 day moving average crossing at 11.65 would confirm that a short term top has been posted. If March extends the rally off November's low, September's high crossing at 12.40 is the next upside target.

Wheat closed lower on Wednesday ending a two day short covering bounce off last Friday's low. Today's low range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI are diverging but are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 5.98 1/4 would confirm that a short term low has been posted. If March extends the decline off October's high, weekly support crossing at 5.54 3/4 is the next downside target. First resistance is the 20 day moving average crossing at 5.98 1/4. Second resistance is the reaction high crossing at 6.12 3/4. First support is last Friday's low crossing at 5.60 1/2. Second support is weekly support crossing at 5.54 3/4.

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Commodities Close the Week on a High Note - Crude Oil, Natural Gas, Gold, Corn and Coffee

Crude oil closed higher due to short covering on Friday as it consolidated some of the decline off last August's high. Today's mid range close sets the stage for a steady opening when Monday's night session begins. Stochastics and the RSI are oversold but remain neutral to bearish signaling that additional weakness is possible. If February extends the aforementioned decline, the June 2013 low crossing at 90.05 is the next downside target. Closes above the 20 day moving average crossing at 96.76 would confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 95.12. Second resistance is the 20 day moving average crossing at 96.76. First support is Thursday's low crossing at 91.24. Second support is the June 2013 low crossing at 90.05.

Natural gas closed higher due to short covering on Friday as it consolidated some of the decline off December's high. The high range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near term. If February extends the decline off December's high, the 62% retracement level of the November-December rally crossing at 3.897 is the next downside target. Closes above the 20 day moving average crossing at 4.328 would confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 4.328. Second resistance is the reaction high crossing at 4.430. First support is today's low crossing at 3.953. Second support is the 62% retracement level of the November-December rally crossing at 3.897.

Gold closed higher on Friday as it extends the rally off December's low. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. If April extends the rally off December's low, December's high crossing at 1266.70 is the next upside target. If April renews the decline off August's high, weekly support crossing at 1179.40 is the next downside target. First resistance is today's high crossing at 1249.00. Second resistance is December's high crossing at 1266.70. First support is December's low crossing at 1182.30. Second support is weekly support crossing at 1179.40.

Corn closed sharply higher on Friday following today's USDA report. The USDA caught the trade leaning the wrong way after releasing a lower than expected corn crop estimate for 2013's crop production and lower than expected ending stocks. The USDA estimated the 2013 corn crop at 13.925 billion bushels. The USDA juggled its harvested acreage and yields, putting the average for the crop nationwide at 158.8 bpa, which was down 1.6 bpa from its last estimate, though acreage went up 436,000. The USDA came in with a lower than expected figure on Dec. 1st corn inventories, which suggests feed usage in the first quarter of the marketing year was good despite the late harvest. That raised the total forecast for feeding during the marketing year by100 million bushels.

The USDA also increased its forecasted usage for ethanol by 50 million bushels due to strong demand. The increase usage from ethanol was offset by a 50 million bushel decline in other industrial usage, leaving ending stocks at 1.631 billion. Today's key reversal up along with the close above the previous reaction high crossing at 4.30 confirmed that a short term low has been posted. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are diverging but are turning neutral signaling additional strength is possible near term. Closes above December's high crossing at 4.40 3/4 are needed to confirm that a seasonal low has been posted. First resistance is the reaction high crossing at 4.36. Second resistance is December's high crossing at 4.40 3/4. First support is today's low crossing at 4.06 1/4. Second support is weekly support crossing at 3.99 3/4.

Coffee closed higher on Friday and the high range close set the stage for a steady to higher opening on Monday. Stochastics and the RSI are diverging but remain neutral to bullish signaling that sideways to higher prices are possible near term. If March extends the aforementioned rally, September's high crossing at 12.40 is the next upside target. Closes below last Thursday's low crossing at 11.02 would confirm that a short term top has been posted.

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This Thursday, John Carters "Voodoo Lines" Webinar

Free webinar on Thursday, January 9th at 8:00 p.m. eastern time. John Carter of Simpler Options is back with another one of his wildly popular free trading webinars.

In this Free Webinar you will learn:

    *   How to Identify Key Support and Resistance Levels
    *   What are Voo Doo Lines?
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Do you believe in Voo Doo? John Carters "Voodoo Lines"

Crude Oil Closes Sharply Lower to Start 2014

Crude oil bulls got slaughtered right out of the gate to get 2014 started as crude oil closes sharply lower on Thursday and below the 20 day moving average crossing at 98.23 confirming that a short term top has been posted. The low range close sets the stage for a steady to lower opening when Friday's night session begins. Stochastics and the RSI have turned bearish signaling that additional weakness is likely. If February extends this week's decline, November's low crossing at 92.10 is the next downside target. Closes above the 10 day moving average crossing at 98.77 are needed to temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 98.77. Second resistance is last Friday's high crossing at 100.75. First support is today's low crossing at 95.34. Second support is November's low crossing at 92.10.

Natural gas closed higher due to short covering on Thursday as it consolidated some of Tuesday's sharp decline. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If February extends Tuesday's decline, the 38% retracement level of the November-December rally crossing at 4.158 is the next downside target. Closes above the 10 day moving average crossing at 4.403 would temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 4.403. Second resistance is December's high crossing at 4.532. First support is today's low crossing at 4.213. Second support is the 38% retracement level of the November-December rally crossing at 4.158.

Gold closed higher on Thursday due to a short covering rally. The high range close sets the stage for a steady to higher opening when Friday's night session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 1224.00 are needed to confirm that a low has been posted. If February extends the decline off August's high, weekly support crossing at 1179.40 is the next downside target. First resistance is the 20 day moving average crossing at 1224.00. Second resistance is the reaction high crossing at 1267.50. First support is Tuesday's low crossing at 1181.40. Second support is weekly support crossing at 1179.40.

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Commodity Markets Summary for Thursday December 19th

Crude oil closed higher on Thursday renewing the rally off November's low. The high range close sets the stage for a steady to higher opening when Friday's night session begins. Stochastics and the RSI are diverging but are turning neutral to bullish signaling that sideways to higher prices are possible near term. If January renews the rally off November's low, the 50% retracement level of the August-November decline crossing at 99.87 is the next upside target. Closes below the 20 day moving average crossing at 96.19 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 99.17. Second resistance is the 50% retracement level of the August-November decline crossing at 99.87. First support is the 20 day moving average crossing at 96.19. Second support is November's low crossing at 91.77.

Natural gas closed sharply higher on Thursday renewing the rally off November's low. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are diverging but are turning neutral signaling that sideways to higher prices are possible near term. If January extends the rally off November's low, the 75% retracement level of this year's decline crossing at 4.487 is the next upside target. Closes below the 20 day moving average crossing at 4.104 would confirm that a short term top has been posted. First resistance is today's high crossing at 4.471. Second resistance is the 75% retracement level of this year's decline crossing at 4.487. First support is the reaction low crossing at 4.172. Second support is the 20 day moving average crossing at 4.104.

The March S&P 500 closed lower due to light profit taking on Thursday as it consolidated some of this week's rally. The high range close sets the stage for a steady to higher opening when Friday's night session begins trading. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. If March extends this year's rally into uncharted territory, upside targets will be hard to project. If March renews the decline off November's high, the reaction low crossing at 1738.70 is the next downside target. First resistance is today's high crossing at 1806.10. Second resistance is unknown. First support is Monday's low crossing at 1755.00. Second support is the reaction low crossing at 1738.70.

Gold closed lower on Thursday renewing the decline off August's high. The low range close sets the stage for a steady to lower opening when Friday's night session begins trading. Stochastics and the RSI are diverging but bearish signaling that sideways to lower prices are possible near term. If February renews the decline off August high, June's low crossing at 1187.90 is the next downside target. Closes above last Tuesday's high crossing at 1267.50 are needed to confirm that a low has been posted. First resistance is last Tuesday's high crossing at 1267.50. Second resistance is the reaction high crossing at 1294.70. First support is today's low crossing at 1190.00. Second support is June's low crossing at 1187.90.

COT Fund fav coffee closed lower on Thursday as it consolidates some of the rally off November's low. The low range close set the stage for a steady to lower opening on Friday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. If March extends this month's rally, the reaction high crossing at 12.10 is the next upside target. Closes below the 20 day moving average crossing at 11.04 would confirm that a short term top has been posted.

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Mid Week Market Summary for Wednesday December 11th

The S&P 500 closed lower on Wednesday. The low range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. If March renews this year's rally into uncharted territory upside targets will be hard to project. Multiple closes below last Wednesday's low crossing at 1774.80 are needed to confirm that a short term top has been posted. First resistance is November's high crossing at 1805.50. Second resistance is unknown. First support is last Wednesday's low crossing at 1774.80. Second support is the reaction low crossing at 1769.00.

Crude oil closed lower due to profit taking on Wednesday as it consolidated some of the rally off November's low. The low range close sets the stage for a steady to lower opening when Thursday's night session begins. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If January extends the rally off November's low, the 50% retracement level of the August-November decline crossing at 99.87 is the next upside target. Closes below the 20 day moving average crossing at 95.16 would confirm that a short term top has been posted. First resistance is today's high crossing at 98.75. Second resistance is the 50% retracement level of the August-November decline crossing at 99.87. First support is the 20 day moving average crossing at 95.16. Second support is November's low crossing at 91.77.


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Natural gas closed sharply higher on Wednesday and above the 62% retracement level of this year's decline crossing at 4.307 as it extends the rally off November's low. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If January extends the rally off November's low, the 75% retracement level of this year's decline crossing at 4.487 is the next upside target. Closes below the 20 day moving average crossing at 3.902 would confirm that a short term top has been posted. First resistance is today's high crossing at 4.340. Second resistance is the 75% retracement level of this year's decline crossing at 4.487. First support is the 10 day moving average crossing at 4.082. Second support is the 20 day moving average crossing at 3.902.

Gold closed lower as it consolidated some of on Tuesday rally but remains above the 20 day moving average crossing at 1250.50. The low range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. If February extends Tuesday's rally, the reaction high crossing at 1294.70 is the next upside target. If February renews the decline off August' high, June's low crossing at 1187.90 is the next downside target. First resistance is Tuesday's high crossing at 1267.50. Second resistance is the reaction high crossing at 1294.70. First support is last Friday's low crossing at 1210.10. Second support is June's low crossing at 1187.90.

Silver closed higher on Wednesday as it extended the rally off last Wednesday's low. The low range close set the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term. If January extends this week's rally, the reaction high crossing at 20.805 is the next upside target. If January renews the decline off October's high, June's low crossing at 18.615 is the next downside target. First resistance is today's high crossing at 20.430. Second resistance is the reaction high crossing at 20.805. First support is last Wednesday's low crossing at 18.900. Second support is June's low crossing at 18.615.

The U.S. Dollar closed lower on Wednesday as it extends the decline off November's high. The mid range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If March extends the decline off November's high, October's low crossing at 79.35 is the next downside target. Closes above the 20 day moving average crossing at 80.82 would confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 80.82. Second resistance is November's high crossing at 81.73. First support is today's low crossing at 79.87. Second support is October's low crossing at 79.35.

The Japanese Yen closed higher due to short covering on Wednesday. The mid-range close sets the stage for a steady opening when Thursday's night session begins trading. Stochastics and the RSI are diverging but are neutral to bearish signaling that sideways to lower prices are possible near term. If March extends the decline off October's high, weekly support crossing at .9640 is the next downside target. Closes above the 20 day moving average crossing at .9857 are needed to confirm that a short term low has been posted. First resistance is last Thursday's high crossing at .9845. Second resistance is the 20 day moving average crossing at .9857. First support is Tuesday's low crossing at .9678. Second support is weekly support crossing at .9640.

Coffee closed lower on Wednesday. The low range close set the stage for a steady to lower opening on Thursday. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 11.29 are needed to renew the rally off November's low. If March renews last week's decline, November's low crossing at 10.41 is the next downside target.

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Mid Week COT Market Summary for Thursday November 14th

December Nymex crude oil Stochastics and the RSI are diverging but have turned bearish signaling that sideways to lower prices are possible near term. If December extends the decline off August's high, the 75% retracement level of the April-August rally crossing at 91.54 is the next downside target. Closes above the 20 day moving average crossing at 96.14 are needed to confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 94.18. Second resistance is the 20 day moving average crossing at 96.14. First support is Tuesday's low crossing at 92.86. Second support is the 75% retracement level of the April-August rally crossing at 91.54.

December Henry natural gas trades lower as it consolidates some of the rally off last Tuesday's low. Stochastics and the RSI are neutral to bullish signaling that a low might be in or is near. Closes above the 20 day moving average crossing at 3.623 are needed to confirm that a short term low has been posted. If December renews this year's decline, weekly support crossing at 3.178 is the next downside target. First resistance is the 20 day moving average crossing at 3.623. Second resistance is the reaction high crossing at 3.835. First support is last Tuesday's low crossing at 3.379. Second support is weekly support crossing at 3.178.

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December gold was higher due to short covering on Wednesday night as it consolidates some of the decline off October's high. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If December extends the decline off October's high, October's low crossing at 1251.00 is the next upside target. Closes above the 20 day moving average crossing at 1316.40 are needed to confirm that a short term top has been posted. First resistance is the 10 day moving average crossing at 1294.80. Second resistance is the 20 day moving average crossing at 1316.40. First support is Tuesday's low crossing at 1275.80. Second support is October's low crossing at 1251.00.

The December U.S. Dollar traded higher in Wednesday evenings trading but remains below the 38% retracement level of the July-October decline crossing at 81.41. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If December extends the rally off October's low, the 50% retracement level of the July-October decline crossing at 82.14 is the next upside target. Closes below the 20 day moving average crossing at 80.26 would confirm that a short term top has been posted. First resistance is last Friday's high crossing at 81.58. Second resistance is the 50% retracement level of the July-October decline crossing at 82.14. First support is the 10 day moving average crossing at 80.96. Second support is the 20 day moving average crossing at 80.26.

How much lower can COT favorite Coffee go? December coffee closed down 295 points at 102.85 cents on Wednesday. Prices closed nearer the session low and scored a bearish “outside day” down on the daily bar chart. The coffee bears have the solid overall near term technical advantage.

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COT Week Ending Market Summary - Crude Oil, Natural Gas, SP 500 nad Gold

October crude oil closed lower on Friday. The high range close sets the stage for a steady to higher opening when Monday's night session begins. Stochastics and the RSI are neutral to bearish hinting that sideways to lower prices are possible near term. Multiple closes below Tuesday's low crossing at 106.39 are needed to confirm that a short term top has been posted. If October renews this summer's rally, weekly resistance crossing at 114.83 is the next upside target. First resistance is August's high crossing at 112.24. Second resistance is weekly resistance crossing at 114.83. First support is Tuesday's low crossing at 106.39. Second support is the reaction low crossing at 103.50.

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October Henry natural gas closed higher on Friday. The high range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near term. If October renews the rally off August's low, the 50% retracement level of the May-August decline crossing at 3.842 is the next upside target. Closes below the 20 day moving average crossing at 3.568 would confirm that a short term top has been posted while opening the door for additional weakness near term. First resistance is the 38% retracement level of the May-August decline crossing at 3.680. Second resistance is the 50% retracement level of the May-August decline crossing at 3.842. First support is the 20 day moving average crossing at 3.568. Second support is August's low crossing at 3.154.

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The December S&P 500 closed higher on Friday. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If December extends the rally off August's low, the reaction high crossing at 1684.40 is the next upside target. Closes below the 20 day moving average crossing at 1648.00 would confirm that a short term top has been posted. First resistance is Thursday's high crossing at 1683.00. Second resistance is the reaction high crossing at 1684.40. First support is the 10 day moving average crossing at 1657.60. Second support is the 20 day moving average crossing at 1648.00.

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October gold closed sharply lower on Friday extending the decline off August's high. The low range close sets the stage for a steady to lower opening when Monday's night session begins trading. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near term. If October extends this week's decline, August's low crossing at 1272.10 is the next downside target. Closes above the 20 day moving average crossing at 1380.40 would temper the near term bearish outlook. First resistance is the 20 day moving average crossing at 1380.40. Second resistance is August's high crossing at 1432.90. First support is today's low crossing at 1304.60. Second resistance is August's low crossing at 1272.10.

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Crude Oil Traders Appear to Shrug Off Syria News....Prices Headed Lower

October crude oil closed lower on Wednesday as it consolidated some of Tuesday's key reversal up. The low range close sets the stage for a steady to lower opening when Thursday's night session begins. Stochastics and the RSI are bearish hinting that a short term top might be in or is near. Closes below the 20 day moving average crossing at 106.46 are needed to confirm that a short term top has been posted. If October renews this summer's rally, weekly resistance crossing at 114.83 is the next upside target. First resistance is last Wednesday's high crossing at 112.24. Second resistance is weekly resistance crossing at 114.83. First support is the 20 day moving average crossing at 106.46. Second support is the reaction low crossing at 103.50.

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October Henry natural gas closed higher on Wednesday and above the 38% retracement level of the May-August decline crossing at 3.680. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If October extends the rally off August's low, the 50% retracement level of the May-August decline crossing at 3.842 is the next upside target. Closes below the 20 day moving average crossing at 3.475 would confirm that a short term top has been posted. First resistance is the 38% retracement level of the May-August decline crossing at 3.680. Second resistance is the 50% retracement level of the May-August decline crossing at 3.842. First support is the 20 day moving average crossing at 3.475. Second support is August's low crossing at 3.154.

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The September S&P 500 closed higher on Wednesday as it extends the rebound off the 50% retracement level of the June-August rally crossing at 1629.45. The high range close sets the stage for a steady to higher opening when Thursday's night session begins trading. Stochastics and the RSI are diverging and are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 1657.83 would confirm that a short term low has been posted. If September renews the decline off August's high, the 62% retracement level of the June-August rally crossing at 1611.47 is the next downside target. First resistance is today's high crossing at 1654.20. Second resistance is the 20 day moving average crossing at 1657.83. First support is last Wednesday's low crossing at 1625.00. Second support is the 62% retracement level of the June-August rally crossing at 1611.47.

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October gold closed lower on Wednesday as it extends the decline off last Wednesday's high. The low range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI have turned bearish hinting that a short term top might be in or is near. Closes below the 20 day moving average crossing at 1367.20 would confirm that a short term top has been posted. If October renews the rally off June's low, May's high crossing at 1489.00 is the next upside target. First resistance is last Wednesday's high crossing at 1432.90. Second resistance is May's high crossing at 1489.00. First support is the 20 day moving average crossing at 1367.20. Second resistance is August's low crossing at 1272.10.

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Crude Oil Shakes off the Nasdaq Blues and Ballmer News to Finish Higher

October crude oil closed higher on Friday. The high range close sets the stage for a steady to higher opening when Monday's night session begins. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near term. Closes below the reaction low crossing at 102.22 would confirm that a double top has been posted. Closes above July's high crossing at 108.93 would renew this summer's rally while opening the door for a possible test of weekly resistance crossing at 110.55 later this summer. First resistance is July's high crossing at 108.93. Second resistance is weekly resistance crossing at 110.55. First support is the reaction low crossing at 102.22. Second support is the 38% retracement level of the April-July rally crossing at 100.27.

The September S&P 500 closed higher on Friday as it extended Thursday's key reversal up. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 1676.40 would confirm that a short term low has been posted. If September resumes the decline off August's high, the 50% retracement level of the June-August rally crossing at 1629.45 is the next downside target. First resistance is the 10 day moving average crossing at 1661.17. Second resistance is the 20 day moving average crossing at 1676.40. First support is Thursday's low crossing at 1631.70. Second support is the 50% retracement level of the June-August rally crossing at 1629.45.

October gold closed higher on Friday renewing the rally off June's low. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If October extends the aforementioned rally, June's high crossing at 1424.00 is the next upside target. Closes below the 20 day moving average crossing at 1333.70 would confirm that a short term top has been posted. First resistance is today's high crossing at 1399.40. Second resistance is June's high crossing at 1424.00. First support is the 20 day moving average crossing at 1333.70. Second resistance is the reaction low crossing at 1272.10.

September Henry natural gas closed lower due to profit taking on Friday as it consolidates some of this month's rally. The low range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near term. If September extends this month's rally, the 38% retracement level of the May-August decline crossing at 3.662 is the next upside target. Closes below the 20 day moving average crossing at 3.473 would confirm that a short term top has been posted. First resistance is today's high crossing at 3.562. Second resistance is the 38% retracement level of the May-August decline crossing at 3.662. First support is the 20 day moving average crossing at 3.473. Second support is August's low crossing at 3.129.

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Crude oil falls as most analyst anticipate global slowdown

September crude oil closed lower on Monday as it consolidated some of last week's rally. The mid range close sets the stage for a steady to lower opening when Tuesday's night session begins. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. Closes above July's high crossing at 108.93 would renew this summer's rally while opening the door for a possible test of weekly resistance crossing at 110.55 later this summer. Closes below last Tuesday's low crossing at 102.67 would confirm that a short term top has been posted. First resistance is July's high crossing at 108.93. Second resistance is weekly resistance crossing at 110.55. First support is last Tuesday's low crossing at 102.67. Second support is the 38% retracement level of the April-July rally crossing at 100.27.

The September S&P 500 closed slightly lower on Friday as it consolidated some of Thursday's rally. The high range close sets the stage for a steady to higher opening when Monday's night session begins trading. Stochastics and the RSI are diverging and are turning neutral to bullish signaling that sideways to higher prices are possible near term. If September extends the rally off June's low, upside targets will now be hard to project with the index trading into uncharted territory. Closes below the 20 day moving average crossing at 1677.36 would confirm that a short term top has been posted. First resistance is today's high crossing at 1703.40. Second resistance is unknown with September trading into uncharted territory. First support is the 20 day moving average crossing at 1677.36. Second support is the reaction low crossing at 1670.50.

September Henry natural gas closed lower on Monday as it extends the decline off May's high. The mid range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If September extends this year's decline, weekly support crossing at 3.178 is the next downside target. Closes above the 20 day moving average crossing at 3.596 would confirm that a short-term low has been posted. First resistance is the 10 day moving average crossing at 3.508. Second resistance is the 20 day moving average crossing at 3.596. First support is today's low crossing at 3.309. Second support is weekly support crossing at 3.178.

October gold closed lower on Monday. The low range close sets the stage for a steady to lower opening when Tuesday's night session begins trading. Stochastics and the RSI are bearish signaling that a short term top might be in or is near. Closes below last Friday's low crossing at 1282.50 would confirm that a short term top has been posted. If October renews the rally off June's low, the reaction high crossing at 1395.20 is the next upside target. First resistance is October's high crossing at 1348.00. Second resistance is the reaction high crossing at 1395.20. First support is last Friday's low crossing at 1282.50. Second support is July's low crossing at 1208.50.

And favorite trade for 2013....September coffee closed higher due to short covering on Monday as it consolidated some of the decline off July's high. The mid range close set the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. Closes above the 20 day moving average crossing at 122.36 would confirm that a short term low has been posted.

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