Crude Rises in New York as U.S. Economic Growth Signals Increased Demand

Crude oil rose after a report showed the U.S. economy grew at a 5.9 percent annual rate in the fourth quarter, signaling that fuel demand may climb in the world’s biggest energy consuming country. Oil increased as much as 2.3 percent after the Commerce Department said gross domestic product gained by the most in six years. The growth rate was higher than the government reported last month. Federal Reserve Chairman Ben S. Bernanke said this week that the U.S. economy is in a “nascent” recovery.

“The positive GDP number is putting upward pressure on prices,” said Peter Beutel, president of trading adviser Cameron Hanover Inc. in New Canaan, Connecticut. “We are going to be focused on anything that gives an indication of where the economy is going.” Crude oil for April delivery rose $1.70, or 2.2 percent, to $79.87 a barrel at 10:41 a.m. on the New York Mercantile Exchange. The April contract is down 0.2 percent this week.

Gasoline for March delivery climbed 4.3 cents, or 2.1 percent, to $2.08 a gallon in New York. The increase in prices accelerated as the dollar dropped against the euro. A weaker U.S. currency bolsters the appeal of raw materials as an alternative investment. The greenback traded at $1.3627 per euro, down 0.6 percent from $1.3548 yesterday. Oil fell 2.3 percent yesterday after the number of Americans filing first time claims for unemployment benefits unexpectedly gained in the week ended Feb. 20, and durable goods orders excluding transportation dropped in January.....Read the entire article.


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Crude Oil Daily Technical Outlook For Friday Morning

Crude oil's consolidation from 80.51 continues today and intraday bias remains neutral. While deeper retreat cannot be ruled out, note that rise from 69.50 is in favor to continue as long as 75.69 support holds. Above 80.51 will target a retest on 83.95 high. However, break of 75.69 will argue that rebound from 69.50 has completed and will turn focus back to this low.

In the bigger picture, crude oil was supported above mentioned 68.59 key support and thus, there was no confirmation of medium term reversal. The strong rebound from 72.43 dampened our bearish view and argue that medium term rise from 33.2 might not be over yet. Nevertheless, as such rise from 33.2 is treated as a correction to whole decline from 147.27 only, even in case of another high above 83.95, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, though, break of 69.50 support will now indicate that crude oil has topped out in medium term already and turn outlook bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Crude Oil Signals Show Overbought Condition, Do we Have a Top?

Crude oil closed lower on Thursday as it consolidates some of this month's rally. The low range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short term top is in or is near.

Closes below the 20 day moving average crossing at 76.80 would confirm that a short term top has been posted. If May resumes this month's rally, the 75% retracement level of the January-February decline crossing at 81.63 is the next upside target.

Thursday evenings pivot point, our line in the sand is 78.58

First resistance is Monday's high crossing at 81.15
Second resistance is the 75% retracement level of the January-February decline crossing at 81.63

First support is today's low crossing at 77.44
Second support is the 20 day moving average crossing at 76.80

Just click here for your FREE trend analysis of crude oil ETF USO

Natural gas closed lower on Thursday and tested the 87% retracement level of the December-January rally crossing at 4.819. The low range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term.

If May extends this week's decline, December's low crossing at 4.656 is the next downside target. Closes above the 20 day moving average crossing at 5.272 are needed to confirm that a low has been posted.

Natural gas pivot point for Thursday evening is 4.811

First resistance is the 10 day moving average crossing at 5.167
Second resistance is the 20 day moving average crossing at 5.272

First support is today's low crossing at 4.808
Second support is December's low crossing at 4.656

Just click here for your FREE trend analysis of natural gas ETF UNG

The U.S. Dollar closed lower due to profit taking on Thursday as it consolidates below the 50% retracement level of the 2009 decline crossing at 81.32. The low range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are diverging but are neutral signaling that sideways to higher prices are possible near term.

If March extends this winter's rally, the 62% retracement level of the 2009 decline crossing at 82.92 is the next upside target. Closes below the 20 day moving average crossing at 80.23 are needed to confirm that a short term top has been posted.

First resistance is last Friday's high crossing at 81.43
Second resistance is the 62% retracement level of the 2009 decline crossing at 82.92

First support is the 20 day moving average crossing at 80.23
Second support is Tuesday's low crossing at 80.15

Just click here for your FREE trend analysis of the U.S. Dollar ETF UUP

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Gold GLD Outperforming Gold Mining Stocks GDX

Gold, the SPDR Gold Shares (NYSE: GLD) and the Market Vectors Gold Miners ETF (NYSE: GDX, have turned positive this morning, in the aftermath of intense selling pressure earlier in the session. This is a sign of meaningful relative strength in the sector, but the day is young yet. Looking at the GDX chart, today's spike low at 41.35 followed by a powerful upmove to 42.50, where it continues to sustain since the opening few minutes, has the look and the feel of the completion of the correction from the 2/18 high at 45.56. With that in mind, I am looking for confirmation of today's low upon an upside penetration of 43.05.



From Mike Paulenoff, author at MPTrader.com, a real-time diary of his technical analysis and trading alerts on ETFs covering metals, energy, equity indices, currencies, Treasuries, and specific industries and international regions.
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Phil Flynn: Bens Magic

Is Ben Bernanke losing his influence over the Energy Market? Oh sure bleak Ben told the market yesterday that interest rates would stay low for infinity and that the economy was not ready for the training wheels you come off but his words seemed to lack the wallop that his words had in the past. Oh sure we got a break in the dollar the stock market and oil dutifully rallied yet at the end of the day it does not seem to be a market game changer like Ben has given us in the past. Perhaps the reason in part that the market realizes that despite the promise low interest rates until the second coming Bens words will have less impact on the value of oil because his words will have less impact on the value of the dollar.

Over the past year it is obvious that Fed Monetary policy of negative interest rates has been the major factor in the rebound in oil. That was in part because the dollar got smashed and the imaginary belive that somehow the EURO was a better currency. Yet does anyone belive that now? On one TV screen you have Ben saying that low interest rates and are here to stay and on the other screen that Greek strikers on the other protesting financial reforms? When you look at that and no matter when you think the Fed will really raise interest rates, will it really make the dollar look worse against the Euro?

We have been living in a world of negative interest rates since last March and to be honest with you the dollar has priced in that scenario to death, Yet now that scenario is changing. Low interest rate promises by the Fed are no longer an excuse to trash the dollar and prop up the euro or even the yen for that matter. Yes the dollar may see some ups and downs yet based on the problems in the rest of the world it appears that the dollar even with low interest rates and record budget deficits the dollar is still undervalued against other global currencies. The Dollar took the brunt of the credit crisis and secretly Ben embraced that. The weak dollar set the stage for the carry trade and helped bail out global banks. Yet now despite bens pronouncement and commitment to low rates the market is showing that rates cannot stay low forever. We see record and near record spreads in the yield curve sending a signal that the market won’t stand for this forever and Ben wants to temper expectations so he can keep the carry trade money machine chugging a little longer. But with the increase in the discount rate and decision within the Fed we all know that we are getting closer to an exit every day so oil bulls cannot on the Fed and this Ben Bernanke inspired rally to go on forever

Oil bulls also bought because we are getting a winter storm in the Northeast, others because we saw an increase in gas demand. But won’t one offset the other? The Energy Information Agency reported a surge in refinery runs to an unimpressive level of 81.2%. The EIA reported that crude inventories increased by 3.0 million barrels, gasoline inventories decreased by 0.9 million barrels and distillate fuel inventories decreased by 0.6 million barrels.

Long term Phil is still bearish on oil. You can contact Phil by emailing him at pflynn@pfgbest.com! Also you can see Phil online today on Fox Business network online and on TV. Check it out!

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Crude Prices Decline, Following Equity Markets After U.S. Economic Reports

Crude oil fell the most in three weeks as U.S. jobless claims and manufacturing orders trailed forecasts, stirring concern that the global economic recovery may falter and crimp energy demand growth. Oil decreased as much as 3.7 percent to the lowest level in a week as the number of Americans filing first time claims for unemployment insurance unexpectedly increased last week, and durable goods excluding transportation declined in January.

“It’s going to take better jobs, better consumer confidence, better business confidence and getting everything going into a better direction before you can support crude oil in a $75 to $80 level,” said Adam Sieminski, chief energy economist at Deutsche Bank AG in Washington.

Crude oil for April delivery fell $2.71, or 3.4 percent, to $77.29 a barrel at 11:36 a.m. on the New York Mercantile Exchange, the biggest decline since Feb. 4. Earlier, it touched $80.32. Oil has dropped 2.6 percent this year.

Initial jobless applications rose by 22,000 to 496,000 in the week ended Feb. 20, Labor Department figures showed today in Washington. The total number of people receiving unemployment insurance gained and those receiving extended benefits decreased.

Orders for durable goods fell 0.6 percent, the biggest drop since August, figures from the Commerce Department showed today in Washington. Bookings for all goods meant to last several years rose 3 percent, more than anticipated and reflecting a jump in commercial aircraft.....Read the entire article.


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New Video: Making Sense of Today's Gold Market

It's been about eight days since we did a video on gold, and given the market action today we thought we would look at what is causing the downward pressure in this market.

If you did not watch our last video on gold, we strongly recommend that you watch the video titled "Five Reasons Why Gold Will Not Make a New High This Time" as it will give you a bigger picture of how we see this market playing out in the next 12 months.

In today's short video we look at an indicator that we have not talked about before in any of our videos. The indicator, which is an overlay on top of the chart, is called the Donchian Channel Indicator.

Richard Donchian, who has since passed away, came up with this indicator in the late '40s. The reason why we like this indicator is the fact that it has successfully stood the test of time. We think you'll really enjoy seeing how it can help you make money in the gold market.

Also in this video, we point out one very important cycle that is in play now and where I think the next tradable low is coming into this market.


As always our videos are free to watch and there are no registration requirements. We would really like to hear back from you, with regards to your thoughts on the gold market, so please feel free to leave a comment.




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Crude Oil Daily Technical Outlook For Thursday

Crude oil continues to stay in tight range below 80.51 today and intraday bias remains neutral for the moment. Deeper retreat to 4 hours 55 EMA (now at 78.12) cannot be ruled out. But after all, rise from 69.50 is in favor to continue as long as 75.69 support holds. Above 80.51 will target a retest on 83.95 high. However, note that Break of 75.69 will argue that rebound from 69.50 has completed and will turn focus back to this low.

In the bigger picture, crude oil was supported above mentioned 68.59 key support and thus, there was no confirmation of medium term reversal. The strong rebound from 72.43 dampened our bearish view and argue that medium term rise from 33.2 might not be over yet. Nevertheless, as such rise from 33.2 is treated as a correction to whole decline from 147.27 only, even in case of another high above 83.95, we'd continue to expect strong resistance near to 50% retracement of 147.27 to 33.2 at 90.24 to bring reversal. On the downside, though, break of 69.50 support will now indicate that crude oil has topped out in medium term already and turn outlook bearish..... Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Gold, Silver & Stock Indices on the Verge of Rolling Over?

From guest analyst Chris Vermeulen....

This week has been playing out as we expected. Last week we saw the market rally on light volume into a resistance zone on the daily chart. Light volume rallies are always a warning sign, much like the “Calm before a Storm”.

The way I look at bearish price action....

The First Heavy Selling Volume Day – I see this as large institution selling massive amounts of investments (stocks & commodities) because prices have risen enough for them to book profits OR they know something we don’t and they are getting out before the majority of traders find out.

Light Volume Rally/Drift Higher – After a heavy volume sell off we tend to see prices drift higher on light volume. This is when the institutions stop dumping investments and allow the retail investors (Un-educated Traders) to buy the market back up.

Bear Market Trend – In a down trend we see these two phases enter and exit the market. These patterns happen on every time frame from tick charts to yearly charts. Trends vary in length from 1-2 cycles and sometimes 10-20 cycles and more…

Current Market Conditions

So far this week we have seen the market sell down on increasing volume which is bearish and is pointing to lower prices. On Wednesday we saw prices move up on light volume with volatility rising into the close with a short wave of selling. This was indicating to me that sellers were starting to enter the market again.

The daily chart below clearly shows the heavy selling and drift higher on declining volume. The market is now trading deep into a resistance zone and looking ready to drop.



SP500 Intraday 2 Hour Candle Charts

You can see the same selling patterns repeat themselves. Since the Feb 5th bottom we have been forming a much larger bear flag which makes me think a BIG drop is only days away.



SP500 Trend Trading Conclusion:

Both stocks and precious metals are trading with the same chart patterns and volume levels. So if you are wondering about gold, silver and oil, I am seeing a similar scenario playing out for them also.

The reason I keep bringing these bearish patterns up in my reports is because once you master trading in a down market then you can make money during some of the fasted moving times in the market. I have always preferred shorting the market because prices drop much quicker then they rise. So profits are made quickly.

Also, if the broad market does eventually roll over later this year, and I am not saying it is, but “IF” it does, then you will feel somewhat comfortable with the positions we will be taking.

If you would like to receive these Free Bi-Weekly Trading Reports please visit Chris Vermeulen's The Gold And Oil Guy.

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Crude Oil Bulls Cling to a Near Term Advantage

Crude oil closed higher on Wednesday and remains poised to extend the rally off this month'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 May extends this month's rally, the 75% retracement level of the January-February decline crossing at 81.63 is the next upside target. Closes below the 20 day moving average crossing at 76.60 would confirm that a short term top has been posted.

Crude oil pivot point, our line in the sand is 79.68

First resistance is Monday's high crossing at 81.15
Second resistance is the 75% retracement level of the January-February decline crossing at 81.63

First support is the 10 day moving average crossing at 78.32
Second support is the 20 day moving average crossing at 76.60

Just click here for your FREE trend analysis of crude oil ETF USO

Natural gas closed higher due to short covering on Wednesday as it consolidated some of this week's decline. The mid range close sets the stage for a steady opening on Thursday. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near term.

If May extends this week's decline, the 87% retracement level of the December-January rally crossing at 4.819 is the next downside target. Closes above the 20 day moving average crossing at 5.293 are needed to confirm that a low has been posted.

Natural gas pivot point for Wednesday evening is 4.861

First resistance is the 10 day moving average crossing at 5.218
Second resistance is the 20 day moving average crossing at 5.293

First support is today's low crossing at 4.859
Second support is the 87% retracement level of the December-January rally crossing at 4.819

Just click here for your FREE trend analysis of natural gas ETF UNG


The U.S. Dollar closed lower due to light profit taking on Wednesday as it consolidates below the 50% retracement level of the 2009 decline crossing at 81.32. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are diverging but are neutral signaling that sideways to higher prices are possible near term.

If March extends this winter's rally, the 62% retracement level of the 2009 decline crossing at 82.92 is the next upside target. Closes below the 20 day moving average crossing at 80.15 are needed to confirm that a short term top has been posted.

First resistance is last Friday's high crossing at 81.43
Second resistance is the 62% retracement level of the 2009 decline crossing at 82.92

First support is Tuesday's low crossing at 80.15
Second support is the 20 day moving average crossing at 80.15


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