Crude Oil Bulls Take Charge in Mondays Early Trading

Crude oil bulls gained solid momentum Monday morning as oil traded slightly higher in Sunday evenings trading as it extends last week's short covering rally. Bulls extended the run on Monday morning after a report that showed U.S. consumer spending climbed more than forecast in July. Stochastics and the RSI remain neutral to bullish for the near term but we remain bearish overall as long as the bulls do not make a significant breach of the 89 dollar level.

Closes above the reaction high crossing at 89.19 are needed to confirm that a short term low has been posted. If October renews the decline off May's high, the 75% retracement level of the 2009-2011 rally crossing at 71.73 is the next downside target.

First resistance is the 20 day moving average crossing at 85.80.
Second resistance is the reaction high crossing at 89.19.

Crude oil's pivot point for Monday trading is 84.65.

First support is the reaction low crossing at 79.38.
Second support is this month's low crossing at 76.15.

Crude Oil Markets Welcome Ben and Irene over for Friday Trading

Crude oil was slightly lower in Thursday overnight trading as traders watched Hurricane Irene bear down on North Carolina threatening at least 10 oil refineries. But traders seemed to be more concerned with overall demand and how Ben Bernanke will spin the markets from Jackson Hole Wyoming today.

We are giving the oil bulls a slight near term advantage as the Stochastics and RSI remain bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 89.19 are needed to confirm that a short term low has been posted. If October renews the decline off May's high, the 75% retracement level of the 2009-2011 rally crossing at 71.73 is the next downside target.

First resistance is the 20 day moving average crossing at 86.27. Second resistance is the reaction high crossing at 89.19. First support is last Friday's low crossing at 79.38. Second support is this month's low crossing at 76.15. Crude oil pivot point for Friday morning trading is 84.96.

Crude Oil Bulls Struggle to Gain Momentum in Thursdays Session

Crude oil closed lower on Thursday as it consolidates some of this week's rally. The mid range close sets the stage for a steady opening on Friday. Stochastics and the RSI are bullish hinting that a low might be in or is near.

But the bulls have a lot of work ahead of them as closes above the reaction high crossing at 89.19 are needed to confirm that a low has been posted. If October renews this summer's decline, the 75% retracement level of the 2009-2011 rally crossing at 71.72 is the next downside target.

First resistance is the 20 day moving average crossing at 86.82. Second resistance is the reaction high crossing at 89.19. First support is this month's low crossing at 76.15. Second support is the 75% retracement level of the 2009-2011 rally crossing at 71.73.

Chris Vermeulen: Risk Trade is Back, Is a Big Upside Move Starting to Unfold?

The past month investors have been hit hard from the falling stock market. Those who owned gold and bonds have been rewarded. During times of economic fear which leads to selling of stock shares investors and traders find safety in gold and bonds. It was this surge of money coming out of stocks that propelled the price of gold and bonds sharply higher through out this sell off.

On Sunday I warned subscribers that any day now gold should start to correct and there is potential for it to drop all the way back down to the $1640 – $1670 area depending how much of the recent buying volume was investment versus speculative money which will quickly sell out if prices began to fall.

Take a look at the intraday charts below to get a visual of how money is moving around the market and how economic fear plays a roll on investment decisions:

Seven Day 10 Minute Chart Pre-Market Selloff This Past July
Here you can see investors became fearful of the stock market/economic environment. Money started to get pulled out of the high risk (Risk On Trade) equities market and put to work in the Low risk (Risk Off Trade) to earn small but steady income and to help fight inflation (Gold & Bonds).

After this shift the stock market sold off very strong for a couple weeks before finding a bottom.

Three Day 10 Minute Chart Post-Market Selloff – Todays Prices

If you compare these two charts you will notice they are both opposites to each other…

Meaning money is now getting pulled out of the risk off (gold & bonds) and put to work in the potentially high yielding stocks (risk on).This could be the start of a big upside move starting to unfold and I will be keeping my eye on some charts for possible entry points like SPY and TBT.

Mid-Week Trading Conclusion:
In short, the overall market seems to be entering another pivot point. It is likely that another big move is brewing… After this type of technical damage on the charts and heightened fear/emotions out there, it may cause prices to trade sideways in a large trading rage for a few weeks still so I’m not getting overly excited just yet.

Consider joining us at The Gold and Oil Guy for ETF trade ideas on the SP500, Oil, Gold, and Silver with great accuracy. Check us out at The Gold and Oil Guy.com

Warren Buffett and Lower Inventories Boost The Markets

Crude oil prices were rallying this morning as news of Warren Buffett buying 5 billion dollars worth of troubled Bank of America preferred stock hit the news wires. Rumors were already supporting the markets as traders suspect Federal Reserve Chairman Ben S. Bernanke may announce steps to boost the economy in his speech tomorrow from Jackson Hole.

Crude oil was slightly higher in overnight trading as it extends this week's short covering bounce. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 89.19 are needed to confirm that a short term low has been posted. If October renews the decline off May's high, the 75% retracement level of the 2009-2011 rally crossing at 71.73 is the next downside target.

First resistance is the 20 day moving average crossing at 86.85. Second resistance is the reaction high crossing at 89.19. First support is last Friday's low crossing at 79.38. Second support is this month's low crossing at 76.15. Crude oil pivot point for Thursdays trading is 85.43.

Has the Gold and Silver Market Topped Out?

Has the Gold and Silver market topped out? And have we seen the bottom in the Equity markets?

Today, Gold and Silver confirmed that they have topped out for the time being. The Equity markets are another story, and I’m not quite sure that we have seen a bottom put in place for those markets.

The crude oil market [October contract] is now back in an area that should provide resistance. This is based on the 61.8% Fibonacci retracement level of 85.30. Currently the market is trading a little above that level, which is not totally unusual in volatile markets. Long Term and intermediate term traders should hang on for the ride and protect profits with money management stops. Short term traders should be on the sidelines in this market. The longer term trend for crude oil is down based on our Trade Triangle technology.

Crude oil trend analysis.....

Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = – 85

Crude oil closed down $0.38 a barrel at $85.06 today. Prices closed nearer the session low. The bulls have regaining some upside technical momentum this week. The next near term upside price breakout objective for the bulls is producing a close above solid technical resistance at last week's high of $89.19 a barrel.

Check out todays latest MarketClub video that covers the six major markets that we follow.

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Oil N Gold: Staying Bearish as Long as $89 Resistance Holds

Outlook in crude oil remains unchanged. We'll stay bearish as long as 89.00 resistance holds and expect deeper decline ahead. Below 79.17 will flip bias back to the downside for 75.71 first. Break will confirm resumption of whole fall from 114.83 and should target 70 psychological level next. On the upside, though, break of 89.00 resistance will dampen this bearish view and bring stronger rebound towards 100.62 resistance instead.

In the bigger picture, medium term rebound from 33.2 is treated as the second leg of consolidation pattern from 147.24 and should have finished at 114.83 already. Current decline should now target next key cluster support at 64.23 (61.8% retracement of 33.2 to 114.83 at 64.38). Sustained break will pave the way to retest 33.2 low. On the upside, break of 89.61 resistance is needed to be the first signal of bottoming or we'll stay bearish.


Posted courtesy of Oil N Gold.Com

Is The Line Drawn in the Sand For This Crude Oil Market?

Even though the bulls got a break on wall street today the crude oil market continues to be in a negative trend, and the Dollar Index and the CRB index are for the most part in a sideways mode. Please be aware that our comments are based on the total contract.

The rally has pushed this market back in to an area where you should find resistance right around the 85.30 level. This is a 61.8% Fibonacci retracement. We expect this market to come under pressure on Wednesday or Thursday.

Long term and intermediate term traders should hang on for the ride and protect profits with money management stops. Short term traders should be on the sidelines in this market. The longer term trend for crude oil is down based on our Trade Triangle technology.

Crude oil closed higher due to short covering on Tuesday as it consolidated some of last week's decline. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are turning neutral to bullish hinting that a low might be in or is near.

Closes above the 20 day moving average crossing at 88.12 are needed to confirm that a low has been posted. If October renews this summer's decline, the 75% retracement level of the 2009-2011 rally crossing at 71.72 is the next downside target.

First resistance is the 20 day moving average crossing at 88.12. Second resistance is this month's high crossing at 98.60. First support is this month's low crossing at 76.15. Second support is the 75% retracement level of the 2009-2011 rally crossing at 71.73.

Crude oil Trend Analysis and Trend Score for Tuesday evening....

Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = – 90

David Banister: Is Gold on the Verge of Major Correction?

Just under two weeks ago I wrote about gold likely running to a final top with various levels ranging from 1862 to 1907 per ounce as likely. So far, we bottomed with a pivot at $1730 which I mentioned to my paying subscribers and we have run to as high as $1898 per ounce counting futures trading on August 22nd. What should we expect now as the most likely intermediate trading pattern for Gold?

Clearly, Gold is overbought on traditional technical measures such as RSI, MACD, and Moving Averages and more, so that is one warning flag. To wit, Gold historically pulls back pretty aggressively anytime it has run much above its 20 week EMA line. On a daily chart that stands at about $1730 per ounce, and on a weekly chart around $1580 per ounce. This week marks Fibonacci week #8 from the 1480 pivot lows of a wave 4 pattern I outlined for my subscribers as likely to turn gold higher to 1730 plus. In addition, we are 34 Fibonacci months into this 5 wave Bull Run from the October 2008 $681 lows.

I use Elliott Wave Theory combined with sentiment indicators and other measures to help determine major buy and sell pivots for Gold, and this methodology has been extremely accurate and successful for years. Right now I can count Gold as coming into a final 5th wave thrust to all time highs with sentiment running at huge extremes and technical patterns screamingly overbought. This action in Gold over the last many weeks reminds me of the final blow off top of the NASDAQ in 2000 as it ran from 4000 to 5000 in a few months and exhausted the buyers. This 5 wave pattern began 34 months ago and the final 5th wave usually drags as many taxi cab drivers onto the back of the Bull just in time to dump them off with a bag in their hand and no ride.

The bottom line is Gold is in a 13 year upwards cycle, and we are in about year 10 and it’s due for a likely pause in the uptrend, and certainly a correction of 10-15% would be normal in any massive bull cycle to kick all the bulls and latecomers off the back of the charging Bull. This pause should be a Primary wave 4 consolidation, where 2 and 4 are corrective and 1, 3, and 5 are bullish cycles.

Below is the latest chart on gold, not counting the overnight $1898 highs last night, but you can see that Gold is above the normal pivot high lines where we have seen major corrections over the past 34 month up cycle. A major parabolic blow off rise is of course possible, but hedging long positions and or considering shorting gold for the more aggressive players is advised:

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Adam Hewison: Forget The News If You Want To Trade Successfully!

Many news stories, particularly when it comes to the markets, are basically fed to reporters by folks who have a vested interest in that particular market. I’ve seen this happen time and time again, when information is given to an online anchor or someone else who is on air and reading the latest news. The information that they report, may be not accurate. In the competitive rush to get news online, and be the 1st to break a story, very few stories are ever checked and triple checked.

So we wake up this morning with the potential conflict in Libya over, and Libya’s Colonel Qaddafi’s 42 year reign of insanity has maybe come to an end. Based on that news, the Dow rallies up over 200 points. Let’s see, that little conflict cost the US about 1 trillion dollars, money we don’t have. How could that be good for the market?

Now we are tying the news in Libya to the markets here and the terrible economic conditions that exist, it is a stretch by anyone’s imagination. The truth is, that the markets probably rallied based on a short covering. Many active traders went home with short positions over the weekend. When the markets did not follow through to the downside they quickly covered their short positions and pushed the market higher.

So here’s my advice, do not pay too much attention to the news. Let the market, and the price action give you all the direction you need. Market action is the # 1 item to watch to be a successful trader.

Now, let’s go to the 6 major markets we track every day and see how we can create and maintain your wealth in 2011.

S&P 500
Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = – 90

Remember, despite the big call this morning, the major trend is down for the equity markets. Today’s strong rally was probably an opportunity to go short. We see this market going lower.

SILVER
Monthly Trade Triangles for Long Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short Term Trends = Positive
Combined Strength of Trend Score = + 100

Our Trade Triangles kicked in perfectly with a buy at 42.20 basis spot. Based on this signal, all traders should be long this market or looking to trade silver from the long side.

GOLD
Monthly Trade Triangles for Long Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short Term Trends = Positive
Combined Strength of Trend Score = + 100

Long Term, intermediate and short term traders should hang on for the ride and protect profits with money management stops. It looks more and more likely that we will get close to the magical $2,000 an ounce. We expect to see professional profit taking and some shorting at that level.

CRUDE OIL 
Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = – 90

Despite the knee jerk reaction rally based on the news out of Libya, the trend in crude oil is bearish. Long Term, intermediate and short term traders should hang on for the ride and protect profits with money management stops. The longer term trend for crude oil is down based on our Trade Triangle technology.

DOLLAR INDEX
Monthly Trade Triangles for Long Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = + 55
This market has remained in a fairly well defined trading range for the last several months. With a Chart Analysis Score of + 55 we would want to approach this market using our Donchian Trading Channels as well as our Williams %R indicator. The index remains below its 200 day moving average, while our longer-term Trade Triangle remains positive.

REUTERS/JEFFERIES CRB COMMODITY INDEX
Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Negative
Combined Strength of Trend Score = – 100

While our bias is towards inflation, the index is currently indicating that we are in more of a deflationary scenario. We want to remain patient and let our Trade Triangles signal when this market has made a trend change to the upside. Long Term, intermediate and short term traders should hang on for the ride and protect profits with money management stops.

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