Brad Zigler: Is Crude Oil Taking Lessons From Gold?

Commodity prices sold off hard this week as concerns over credit tightening in the Chinese market prompted traders and investors to rethink their inflation notions. Unexpectedly, in October, year over year inflation on the Chinese mainland rose to 4.4 percent, prompting authorities to jawbone a jack up of interest rates and price controls.

Gold prices tumbled from the $1,400/oz level reached after a nearly unabated three month rise. Industrial commodities also took it on the chin, as fears of slowing growth in China percolated.
But the most industrial of commodities is, of course, oil. Oil had rallied in autumn along with gold, albeit with greater volatility, and with punier returns as well. Gold chugged uphill from July's end to a 14.8 percent gain ahead of the November election. Simultaneously, oil pitched and rolled 3.2 percent higher.

The wheels on the commodity undercarriage started wobbling after the votes were tallied and, more importantly, once the Fed laid out the parameters of its second tranche of quantitative easing. Then oil and gold both tumbled. Gold led the way down, just as it had led the way up. Since the top of November, bullion's slumped 1.7 percent, while front month WTI crude prices have slid 1.3 percent.

Recently, oil prices have gyrated nearly twice as much as gold. This autumn, the annualized standard deviation in oil's daily close has been 27.8 percent, while gold's wobbled at a 14.7 percent rate.

But most arresting is the expectations of future volatility reflected in option prices. As gold topped the $1,400 mark, the CBOE Gold Volatility Index (CBOE: GVZ) jumped to 24.65. This index represents the near term variance in the price of the SPDR Gold Shares Trust (NYSE Arca: GLD) here, an annualized 24.65 percent as imputed to option premiums. A week before, when gold was $50 lower, the volatility index registered 21.87......Read the entire article.



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Where is ExxonMobil Headed From Here?

With the recent beating crude oil bulls have taken is it time to bail on industry leader ExxonMobil (XOM)? A quick look at our "Smart Scan Chart Analysis" technology confirms that a short term counter trend move is underway.

When this action is over look for the longer term positive trend to resume. Be sure to trade this uptrend with tight money management stops.

Based on a pre-defined weighted trend formula for chart analysis, XOM scored +85 on a scale from -100 (strong downtrend) to +100 (strong uptrend):

+10......Last Hour Close Above 5 Hour Moving Avg
-15......New 3 Day Low on Tuesday
+20......Last Price Above 20 Day Moving Average
+25......New 3 Week High, Week Ending Nov. 13th
+30......New 3 Month High in November
+85......Total Score

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How to Improve Your ETF Trading Instantly!

Today we will be looking at our trade triangle technology and how it can help you time the ETF markets successfully.


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Crude Oil Daily Technical Outlook For Friday Morning Nov. 19th

Crude oil was higher due to short covering overnight as it consolidates some of the decline off last week's high. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term.

If December extends the aforementioned decline, the 62% retracement level of the August-November rally crossing at 78.56 is the next downside target. Closes above the 10 day moving average crossing at 84.57 would confirm that a short term low has been posted.

First resistance is the 20 day moving average crossing at 84.06
Second resistance is the 10 day moving average crossing at 84.57

Crude oil pivot point for Friday morning is 82.09

First support is Wednesday's low crossing at 80.06
Second support is the 62% retracement level of the August-November rally crossing at 78.56


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Commodity Corner: Crude Oil Up 1.75% on Irish Expectations

Mounting expectations that Ireland will accept a bank bailout from the European Union caused the greenback to weaken, causing December crude oil futures to end the day higher Thursday.

Oil rose $1.41 to settle at $81.85 a barrel. After some reluctance this week, Irish government officials on Thursday confirmed that they were pursuing a loan from the EU to bolster the country's banking system. The Irish government's shifting position in turn provided some comfort to other EU economies grappling with their own debt crises. Moreover, it helped the euro to reverse recent losses and gain 0.8 percent against the dollar.

Front-month crude traded within a range from $80.44 to $82.35 Thursday.

Buoyed by the prospect of a busier Thanksgiving travel period this year, along with low East Coast inventories, gasoline surged more than three percent to settle at $2.23 a gallon. December gasoline traded from $2.16 to $2.24.

Natural gas for December delivery fell two cents to end the day at $4.01 per thousand cubic feet. The futures price fluctuated from $3.85 to $4.04.


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Matt Nesto: Where is Crude Oil and Gold Headed on Friday?

CNBC's Matt Nesto reports on the day's activity in the commodities markets, and looks at where oil and gold are likely headed tomorrow.



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Stock Market and Commodities Commentary For Thursday Evening Nov. 18th

The S&P 500 index closed sharply higher on Thursday as it consolidates some of the decline off last week's high. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If December extends the decline off last week's high, the 25% retracement level of the July-November rally crossing at 1169.37 is the next downside target. Closes above the 10 day moving average crossing at 1201.82 would temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 1201.82. Second resistance is this month's high crossing at 1224.50. First support is Tuesday's low crossing at 1175.20. Second support is the 25% retracement level of the July-November rally crossing at 1169.37.

Crude oil closed higher due to short covering on Thursday as it rebounded off the 50% retracement level of the August-November rally crossing at 80.49. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If December extends the decline off last week's high, the 62% retracement level of the August-November rally crossing at 78.56 is the next downside target. Closes above the 10 day moving average crossing at 85.05 are needed to confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 84.04. Second resistance is the 10 day moving average crossing at 85.05. First support is Wednesday's low crossing at 80.06. Second support is the 62% retracement level of the August-November rally crossing at 78.56.

Natural gas closed lower on Thursday as it consolidates some of Wednesday's rally. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. If December renews the rally off October's low, the 38% retracement level of the June-October decline crossing at 4.362 is the next upside target. Closes below the reaction low crossing at 3.743 are needed to confirm that a short term top has been posted. First resistance is last Wednesday's high crossing at 4.249. Second resistance is the 38% retracement level of the June-October decline crossing at 4.362. First support is Monday's low crossing at 3.710. Second support is the reaction low crossing at 3.500.

Gold closed higher due to short covering on Thursday as it consolidated some of decline off last week's high. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain bearish signaling that sideways to lower prices is possible near term. If December extends the decline off last week's high, the reaction low crossing at 1315.60 is the next downside target. Closes above the 10 day moving average crossing at 1377.50 would temper the near term bearish outlook. First resistance is the 20 day moving average crossing at 1361.40. Second resistance is the 10 day moving average crossing at 1377.50. First support is Tuesday's low crossing at 1329.00. Second support is the reaction low crossing at 1315.60.

The U.S. Dollar closed lower due to profit taking on Thursday as it consolidates some of this month's rally. The mid-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 might be in or is near. Closes below the 20 day moving average crossing at 77.75 are needed to confirm that a short term top has been posted. If December extends this month's rally, the 38% retracement level of this year's decline crossing at 80.54 is the next upside target. First resistance is Tuesday's high crossing at 79.59. Second resistance is the 38% retracement level of this year's decline crossing at 80.54. First support is the 20 day moving average crossing at 77.75. Second support is this month's low crossing at 75.24.


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Phil Flynn: Shake It Off!

Can the global commodity markets shake off the threats of Chinese rate hikes? Well today they are going to try. Still yesterday the oil markets ignored a very bullish oil inventory report after Chinese Premier Wen Jiabao said that he and the state council were drafting measure to address inflation. This led to the belief that interest rates in China may go up dramatically and curtail that oh so precious Chinese oil demand... Not Even a massive drop in US oil supply was enough to deter the market from going lower.

The EIA reported that U.S. commercial crude oil inventories decreased by a whopping 7.3 million barrels from the previous week. At 357.6 million barrels, U.S. crude oil inventories are above the upper limit of the average range for this time of year. Total motor gasoline inventories decreased by 2.7 million barrels last week and are in the upper half of the average range. Both finished gasoline inventories and blending components inventories decreased last week.

Distillate fuel inventories decreased by 1.1 million barrels and are above the upper boundary of the average range for this time of year. Oil Exports and Low imports and refinery maintenance are the reason for the draws. The strikes in France are still taking a toll on our supply. Bloomberg News China International United Petroleum & Chemical Co., the nation’s largest oil trader, plans to boost diesel imports for a second month in December to ease a domestic shortage of the transport fuel.

China International, or Unipec, plans to import 120,000 tons for December delivery, compared with......Read the entire article.


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Crude Oil Daily Technical Outlook For Thursday Morning Nov. 18th

Crude oil was higher due to short covering overnight as it consolidates some of the decline off last week's high. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term.

If December extends the aforementioned decline, the 62% retracement level of the August-November rally crossing at 78.56 is the next downside target. Closes above the 10 day moving average crossing at 85.03 would confirm that a short term low has been posted.

First resistance is the 20 day moving average crossing at 84.03
Second resistance is the 10 day moving average crossing at 85.03

Crude oil pivot point for Thursday is 81.06

First support is Wednesday's low crossing at 80.06
Second support is the 62% retracement level of the August-November rally crossing at 78.56



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Bloomberg: Crude Oil Rebounds From Four Week Low After Surprise Drop in U.S. Crude Supplies

Crude oil rebounded from a four week low as the growing prospect that Ireland will get a rescue bailout from the European Union stoked gains for stocks and commodities around the world. Crude rose as much as 2.1 percent, snapping four days of declines, after Ireland’s central bank governor said he expects the country to seek a bailout from the European Union and the International Monetary Fund. Yesterday’s Energy Department report showed crude inventories unexpectedly dropped the most since August 2009.

“The situation in Europe looks like it’s going towards a solution,” said Sintje Diek, an analyst with HSH Nordbank in Hamburg. “There will be a rescue for Ireland, and that’s good news for the euro. Fundamentals are on the side of investors; inventories are going down.” Crude for December delivery advanced as much as $1.70 to $82.14 a barrel on the New York Mercantile Exchange. It was at $81.72 at 11:37 a.m. London time. Brent crude for January settlement rose as much as $1.72, or 2.1 percent, to $85 a barrel on the London based ICE Futures Europe exchange.

The New York contract, which expires tomorrow, fell yesterday to $80.44, the lowest settlement since Oct. 19. The more actively traded January future was up $1.31 at $82.35. Crude slumped yesterday amid speculation that China, the world’s biggest energy consuming country, will raise interest rates to cool economic growth. Prices also dropped on concern Europe’s debt crisis is worsening. Oil has fallen 4 percent since last week and is up 2.7 percent this year......Read the entire article.



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