Crude Oil Advances Above $75 a Barrel Before Inventory Report

Crude oil rose to a one month high in New York as the euro gained against the dollar, bolstering the appeal of commodities, and on forecasts that a government report will show U.S. supplies fell for a third week. Oil climbed as much as 2.1 percent after the 16 nation currency strengthened, following increases in global stock markets. U.S. crude oil inventories probably declined 1 million barrels in the week ended June 11, according to the median of 13 analyst responses in a Bloomberg News survey.

“The euro is higher and oil is following,” said Stephen Schork, president of consultant Schork Group Inc. in Villanova, Pennsylvania. “There’s been a very strong correlation between currencies and oil recently.” Crude oil for July delivery rose $1.51, or 2 percent, to $76.63 a barrel at 11:05 a.m. on the New York Mercantile Exchange. Oil touched $76.70, the highest level since May 12. Futures are up 8.5 percent from a year ago.

Brent crude oil for July settlement climbed $1, or 1.3 percent, to $76.20 a barrel on the London based ICE Futures Europe exchange. The July contract expires today. The more active August futures increased $1.15, or 1.5 percent, to $76.81 a barrel. The euro strengthened to $1.2316, up 0.8 percent from $1.2221 yesterday. The currency touched $1.1877 on June 7, the lowest level since March 2006, on concern that the debt crisis in Greece will spread to other countries in the region.

“The bulls are trying to move oil higher, and they’ve been getting intermittent support from the euro and dollar,” said Peter Beutel, president of energy adviser Cameron Hanover Inc. in New Canaan, Connecticut.....Read the entire article.


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New Video: A Quick Update on the S & P 500

The sharp rally we saw on Friday followed through on Monday, but appears to have run out of steam. In this new short video, we show you what you should be looking at in this market and how we think it should be played.

The video is short, less than two minutes, but you'll get a lot of good information that will help you trade these choppy, choppy markets.

As always we are interested in your views on the SP 500, so please leave us a comment and tell us what you think.


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Crude Oil Stochastics-RSI are Becoming Overbought But Remain Bullish

Crude oil was higher overnight as it extends last week's rally. Stochastics and the RSI are becoming overbought but remain bullish signaling that additional short term gains are possible.

If July extends the rally off May's low, the 50% retracement level of May's decline crossing at 78.46 is the next upside target. Closes below the 20 day moving average crossing at 72.73 would confirm that a short term top has been posted.

First resistance is last Friday's high crossing at 75.42
Second resistance is the 50% retracement level of May's decline crossing at 78.46

Crude oil's pivot point for Tuesday morning is 75.05

First support is the 10 day moving average crossing at 73.71
Second support is the 20 day moving average crossing at 72.73


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New Video: How to Tell When a Market is Oversold

Markets can get oversold, but when is a market really oversold?

In our latest video we show you a specific example of how markets can become oversold, stay that way, and why sometimes a relief rally doesn't change anything.

This is a short video and it's one we highly recommend watching as it will help you in the future to be aware of the oversold phenomenon.

We invite you to take a look at this new video and as always it can be viewed with no registration and at no charge.

We are also interested in your views or strategy dealing with an oversold market, so please feel free to leave us a comment.

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Crude Oil Rises Above $75 After European Industrial Output Gains

Crude oil rose above $75 a barrel on speculation economic growth will accelerate after European industrial production climbed more than forecast in April. Oil increased as much as 3 percent after the European Union’s statistics office reported that output in the 16 nations using the euro advanced 0.8 percent. Economists projected a gain of 0.5 percent, according to a Bloomberg News survey. The dollar dropped to its lowest level against the common currency in more than a week, strengthening the appeal of commodities.

“The industrial numbers out of Europe were somewhat better than expected, which is bolstering confidence about the region’s economy,” said Phil Flynn, vice president of research at PFGBest in Chicago. “The strength of the euro is a major factor pushing most commodities higher today.” Crude oil for July delivery rose $1.25, or 1.7 percent, to $75.03 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures are up 4.2 percent from a year ago.

Brent crude oil for July delivery increased 68 cents, or 0.9 percent, to $75.03 a barrel on the London based ICE Futures Europe exchange. Oil retreated from the day’s high after Moody’s Investors Service said it downgraded Greece’s government bond ratings by four levels to Ba1 from A3. Oil and the euro tumbled in May on concern that Greece’s debt crisis would spread to other nations using the common currency.

The dollar declined against the euro for the fourth time in five days. The single currency gained as much as 1.5 percent to $1.2299, the highest since June 3. The Standard & Poor’s 500 Index increased 0.2 percent to 1,093.89.....Read the entire article.


New Video: Japanese Candlesticks and The Gold Market


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New Video: Japanese Candlesticks and The Gold Market

We have just finished a short video on the spot gold market using Japanese candlestick charts. In this new video we show you some important elements that you would not necessarily see using traditional Western charts.

We invite you to take a look at this new video with no registration and no charge. And whether you agree, disagree, or just want to comment on this video, please feel free to do so.


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Crude Oil Poised to Extend Last Week's Rally

Crude oil was higher overnight and is poised to extend last week's rally. Stochastics and the RSI remain bullish signaling that additional short term gains are possible. Closes above the reaction high crossing at 75.72 are needed to confirm that a short term low has been posted and renew the rally off May's low. If July renews the decline off April's high, weekly support crossing at 65.66 is the next downside target.

First resistance is last Thursday's high crossing at 76.30
Second resistance is the 50% retracement level of May's decline crossing at 78.46

Crude oil's pivot point for Monday morning is 74.23

First support is the 20 day moving average crossing at 72.61
Second support is last Monday's low crossing at 69.51


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SP500, Oil and Gold Trading at Resistance Levels

Last week we saw the financial market including commodities move higher which was great to see. But the recent run up has brought both equities and commodities to their key resistance levels. With Gold, Oil and the SP500 trading near key resistance points we will most likely have some sharp movements this week so buckle up tight!

Gold – Daily Chart
Gold Future Prices continue to form the large cup and handle pattern and is trading near resistance. This week I figure we will see gold make a move up or break the dotted support trend line and drop towards the blue support level. I continue to wait for a low risk setup for gold.

Crude Oil – Daily Chart
Crude oil has been trending down for a couple months and recently rebounded to test its resistance level. It looks as though oil is forming a bear flag which generally means we should see lower prices in the near future. But another $1-2 move up could trigger a surge of buyers if this resistance level is broken which is why this week should be volatile… it’s a 50/50 chance for commodities to either rally or sell off.

SP500 – Daily Chart
The SP500 has posted some decent gains the past couple days but it’s still no in the clear just yet… Most technicians are looking for a move above 1100-1110 area with heavy volume before they start to commit serious money to the long side.

It looks and feels as though the market could drop or rally very sharply from here and if you are caught on the wrong side of the move then it’s going to really hurt the trading account. During times like this when the market is at a critical pivot point with increased volatility levels along with mixed market internals I tend to stay on the side lines until some dust settles.

Weekend Gold, Oil and SPX Trading Conclusion
In short, everything is trading near key pivot points giving mixed signals for prices to rally or drop. My analysis is pointing to a small move up Monday morning to break Fridays high followed by some selling late Monday or Tuesday. How much of a move down I don’t know for sure but there is potential for a 3-4% move. On the flip side if buyers step in pushing the price above 1100 then we could see a surge higher of 3-4%…

Very dicey times right now to be trying to pick a direction, which is why it’s best to wait for the risk level to diminish before getting involved or at least trade a small position with a protective stop if you feel confident in a direct.

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Crude Oil Weekly Technical Outlook For Sunday June 13th

Crude oil extended the consolidation from 64.24 and edged higher to 76.30 last week. Nevertheless, there is no change in the view that price actions from 64.24 are merely consolidation to fall from 87.15. Hence, even though another rise cannot be ruled out, we'd expect strong resistance at 61.8% retracement of 87.15 to 64.23 at 78.39 and bring fall resumption. Below 69.51 will flip intraday bias back to the downside for retesting 64.24 low first.

In the bigger picture, prior break of 68.59/69.50 support zone affirms our view that whole medium term rebound from 33.2 has completed at 87.15 already, just ahead of 50% retracement of 147.27 to 33.2 at 90.24. Further decline should be seen to 50% retracement of 33.2 to 87.15 at 60.18 at least. Also, as rebound from 33.2 is viewed as as a correction to the whole correction that started at 2008 at 147.27, we'd anticipate a break of 33.2 low in the longer term. On the upside, break of resistance at 78 level is needed to be indicate that fall from 87.15 is completed. Otherwise, we'll stay bearish.

In the long term picture, current development suggests that rebound from 33.2 is finished at 87.15, inside 76.77/90.24 fibo resistance zone as expected. Our view is that fall fro 87.15 would develop into the third falling leg of the whole correction from 147.27 and hence, we'd anticipate an eventual break of 33.2 low in the long term as such correction extends.....Nymex Crude Oil Continuous Contract 4 Hours Chart.


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Phil Flynn: The Great Retrace

After hitting a high of 8715 on May the third and a low of 6424 on the flash crash low, oil has barreled back to near the $75.00 a barrel area and it appears the great retrace is on. Oil rallied on the illusion of economic stability and a strong euro only to have those daydreams be shattered in financial deception. The oil market has come to a major decision point and may be getting ready to get back into a bull market mode. Yet oil, like a lot of the major markets, are at key technical turning points and they had better make it now or we are going to break it.The markets are acting like the ghosts of May and the nightmare of Europe are behind us and the market is acting like they want to believe again in economic aplomb.

The strongest China exports in 6 years have traders forgetting about their hot inflation. They had good debt auctions across the euro zone and now the markets want to try and believe the crisis in Europe never even happened. And besides Jean Claude Trichet says the euro is a stable currency. Why didn’t he tell us that last week and save us all a whole lot of worry! Yet seeing is believing. The stock market and the oil markets have to follow through and the bonds are going to have to break to keep oil going. The question is: Do you believe?Well I know.....Read the entire article.


The "Super Cycle" in Gold and How It Will Affect Your Pocketbook in 2010


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