Trade ideas, analysis and low risk set ups for commodities, Bitcoin, gold, silver, coffee, the indexes, options and your retirement. We'll help you keep your emotions out of your trading.
Crude oil was slightly higher due to short covering overnight as it consolidates some of this month's decline. Stochastics and the RSI are oversold but remain neutral to bearish signaling that additional weakness is possible near term.
If October extends the aforementioned decline, May's low crossing at 70.35 is the next downside target. Closes above the 20 day moving average crossing at 77.75 would confirm that a short term low has been posted.
First resistance is the 10 day moving average crossing at 74.44
Second resistance is the 20 day moving average crossing at 77.75
Crude oil pivot point for Wednesday morning is 72.00
First support is the overnight low crossing at 71.32
Second support is May's low crossing at 70.35
OPEC's oil revenue is surging, again, and is set to continue growing through 2011 according to the U.S. Energy Information Administration. 2010 oil revenue is likely to be a cool $181 billion higher than that seen in 2009, which makes for a pretty nice rebound.
Rigzone:
Last year, OPEC revenue plummeted to its lowest since 2005, when total revenue exceeded $500B for the first time. EIA forecasts that OPEC members could earn $752B of net oil export revenues in 2010, and with expectations of a slightly higher average in 2011 oil prices, to earn $821B in 2011.
It might take a few years for OPEC to beat 2008's peak oil revenue, but future revenue forecasts could change dramatically should oil prices end up far higher than currently forecast.
You know every once in a while someone defines what you have been trying to say and does it a way that is clear and concise and in terms so clear that you have to say yes, that is exactly what I have been trying to say. For months I have been telling you that despite the fact that I am long term bearish on oil I felt the better way to play this market was not to be married to either a dogmatically bull or bear position but to take advantage of the ranges. I said don’t be a hero, oil is making wide swings.
I pointed out that if you sold oil earlier in the year you are making money now but you would have been down as well and given those profits back many times. If you were long you are losing money. Unlike past years when I advocated being long and hanging on or selling and hanging on this year you are better off not being a bull or bear you are better off being a wolf. Yes Wolf! That’s it! That’s what I have been trying to say! Yes I am bearish and I think oil will eventually breakout on the downside but that moment is being delayed mainly by global economic stimulus.....Read the entire article.
Crude oil was lower overnight as it extends this month's decline. Stochastics and the RSI are oversold but are neutral to bearish signaling that additional weakness is possible near term.
If October extends the aforementioned decline, May's low crossing at 70.35 is the next downside target. Closes above the 20 day moving average crossing at 78.07 would confirm that a short term low has been posted.
First resistance is the 10 day moving average crossing at 75.18
Second resistance is the 20 day moving average crossing at 78.07
Crude oil pivot point for Tuesday morning is 73.44
First support is the overnight low crossing at 72.02
Second support is May's low crossing at 70.35
Oil declined for a fifth day after analysts estimated that U.S. inventories of crude rose last week and as the dollar gained against the euro because of concern the global economy is slowing. Oil dropped to the lowest in almost seven weeks yesterday as investors sought the relative safety of the U.S. currency before economic reports that may show the recovery is faltering. U.S. crude inventories probably increased last week, according to a Bloomberg News survey.
“The price of oil dropped again, showing investor uncertainty over the future of the global economy, mainly that of the U.S.,” said Mike Sander, an investment adviser at Sander Capital Advisors in Seattle. “There just isn’t much positive in the news.” Crude for October delivery dropped as much as 56 cents, or 0.8 percent, to $72.54 a barrel in electronic trading on the New York Mercantile Exchange. It was at $72.79 at 1:02 p.m. Singapore time. Yesterday, the contract lost 72 cents, or 1 percent, to $73.10, the lowest settlement price since July 6. Futures have fallen 8.3 percent since the start of the year.
The dollar rose to $1.2642 per euro at 1:03 p.m. in Singapore, from $1.2657 yesterday, after reaching $1.2621, the highest since July 13. A stronger U.S. currency reduces investor appetite for commodities as a hedge against inflation. Forecasts show sales of existing U.S. homes dropped 13.4 percent in July and gross domestic product growth slowed to a 1.4 percent annual pace in the second quarter, down from 2.4 percent last month.....Read the entire article.
GOLD ALERT: We are moving our gold stops up to $1,222.10 today basis spot gold. Spot gold is currently trading at $1,224.60. This will lock in a $12 profit on the earlier alert we showed you on this blog.
I guess before we start to talk about all news that might drive energy trading, let’s talk about the factors that many of you thought might drive the market this week but did not. I heard from some that they thought that this weekend Israel would bomb Iran’s nuclear sites. Did not happen. Others were worried that the market would be impacted by what is now tropical storm Danielle. Well it looks like Danielle will miss the Gulf of Mexico and go up the East Coast. Of course oil bulls have been hoping for some event to help them out as the shoulder season approaches us with supplies near multi decade highs and gasoline futures near 6 month lows.
As more questions arise about the strength of the economy, the weight upon the market is getting larger. It is getting harder to justify long positions especially as the economic recovery is locked in a quagmire. Weak jobs data and manifesting data and a sense that the economy is going nowhere really is making the market look heavier and heavier with each passing day. In fact even in China crude inventories are rising. Dow Jones reported that China's commercial crude oil stockpiles.....Read the entire article.
Crude oil rebounded from its lowest level in more than six weeks as equity markets advanced, spurring confidence that the economy is improving and fuel demand will recover. Oil rose for the first time in four days as U.S. stocks gained amid speculation takeovers will accelerate, boosting the Standard & Poor’s 500 Index after two weeks of losses. Tropical Storm Danielle may become the Atlantic season’s second hurricane within a day, the National Hurricane Center forecast.
“We’re tracking the equities,” said Gene McGillian, an analyst and broker at Tradition Energy, a procurement adviser in Stamford, Connecticut. “We track the perceptions of how the economy is playing out through the equities and the dollar,” Crude oil for October delivery gained 51 cents, or 0.7 percent, to $74.33 a barrel at 9:54 a.m. on the New York Mercantile Exchange. The price has fallen 6.3 percent this year. The September contract expired at $73.46 on Aug. 20, the lowest closing level since July 6.
The S&P 500 rose 0.9 percent to 1,080.89 after falling to a four-week low last week. The Dow Jones Industrial Average increased 84.54 points, or 0.8 percent, to 10,298.16. “The correlation is still strong with equities and it’s likely to remain so,” said Roland Stenzel, a crude and carbon trader at E&T Energie Handelsgesellschaft mbH in Vienna. “The market continues to fluctuate”.....Read the entire article.
Crude oil was higher due to short covering overnight as it consolidates some of this month's decline. Stochastics and the RSI are oversold but are neutral to bearish signaling that additional weakness is possible near term.
If September extends the aforementioned decline, the 75% retracement level of the May-August rally crossing at 72.96 is the next downside target. Closes above the 20 day moving average crossing at 78.25 would confirm that a short term low has been posted.
First resistance is the 10 day moving average crossing at 76.52
Second resistance is the 20 day moving average crossing at 78.25
Crude oil pivot point for Monday morning is 74.08
First support is last Friday's low crossing at 73.19
Second support is the 75% retracement level of the May-August rally crossing at 72.96
There's no risk to this offer. You have 30 days in which to evaluate MarketClub. If you decide during those 30 days that it's not for you, you will receive a prompt, no questions asked refund. What can be more fair than that? Huge upside and no downside. Should you decide to decline our offer, please keep the free eBook, "RIGHT ON THE MONEY." You benefit no matter what decision you make.
If you are one of the next 1,000 investors/traders to sign up for a 30 Day Risk Free trial to MarketClub, we will also include complete information, formulas, and instructions to both the WORLD CUP PORTFOLIO and the PERFECT PORTFOLIO.
Prices continue to churn as traders and investors try to figure if they want their hard earned dollar in cash or investments. The market is very jittery simply because no one wants to get caught on the wrong side of the market if it makes another 30-40% move, which is why we are seeing money rotate in and out each with very little commitment and follow through. Until a major trend looks to be in place most investors will not me holding many positions over night or through the weekend.
Here are a couple charts on what I think is most likely to happen in gold and the sp500.
GLD – Gold ETF Daily Chart
Last week we saw gold move higher by 1% but I cannot help but think a sharp sell off is only days away from being triggered. Either we get a another pop into resistance which would eventually trigger a wave of sellers and cause a sharp drop or the price of gold will drift lower to eventually break a key support level and trigger stop orders. Once the stops start to get triggered I would expect follow through selling for a couple days which will pull the price of GLD back down to the $113-116 area.
Also there is a possible head and shoulders pattern forming on this chart which is not picture perfect one but, it’s important to be aware as a neckline break could trigger massive selling and pull GLD down to the $100 area. But that would not unfold for several weeks if not months.
SPY – SP500 ETF
SP500 broke down from the support trendline two week ago and has since been trying to bounce. Last week we did see a two day pop but was given back Thursday. As you can see there is a possible mini head & shoulders pattern forming and the current price is testing the neckline. A breakdown below this should trigger a move to the $102 level.
Weekend Trading Conclusion:
In short, the market is trading at a key support level and this week should be exciting. Looking at several large cap stocks I am seeing bear flags on a large percentage of charts. Seeing these forming makes me think lower prices are just around the corner.
It looks like low risk trading setups are about to start popping up across the board and if we get a powerful trend going into the year end there will be some good money made for those on the proper side.
Crude oil's decline from 82.97 extended further as expected last week and continued to sustain below the short term rising trend line. Initial bias remains on the downside this week for 71.09 support next. As discussed before, whole rebound from 64.23 should be finished at 82.97 already. Break of 71.09 will confirm this case and target another low below 64.23. On the upside, above 76.63 resistance will suggest that a short term bottom is in place, possibly with bullish convergence condition in 4 hours MACD. Stronger recovery would be seen in this case. But after all, risk will now remain on the downside as long as 82.97 resistance holds.
In the bigger picture, choppy rebound from 64.23 is treated as a correction to fall from 87.15 only and has possibly finished at 82.97 already. Break of 71.09 will confirm this case and also indicate that whole fall from 87.15 is resuming for 60 psychological level, (50% retracement of 33.2 to 87.15 at 60.18, 100% projection of 87.15 to 64.23 from 82.97 at 60.05). Decisive break there will indicate that fall from 87.15 is developing into a powerful impulsive wave and would target 33.2 low. On the upside, even in case of another rise, focus will remain on reversal signal as crude oil enters into resistance zone of 82.97/87.15.
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 from 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.
Crude oil was lower overnight as it extends this month's decline. Stochastics and the RSI are oversold but are neutral to bearish signaling that additional weakness is possible near term.
If September extends the aforementioned decline, the 75% retracement level of the May-August rally crossing at 72.96 is the next downside target. Closes above the 20 day moving average crossing at 78.24 would confirm that a short term low has been posted.
First resistance is the 10 day moving average crossing at 76.49
Second resistance is the 20 day moving average crossing at 78.24
Crude oil pivot point for Friday morning is 75.19
First support is the overnight low crossing at 73.25
Second support is the 75% retracement level of the May-August rally crossing at 72.96
Sure oil prices and petroleum prices rebounded after the Department of Energy’s Energy Information Agency week over week numbers we not quite as bearish as the American Petroleum Institute report. And yes, oil rebounded as the stock market became positive. Yet there was something lost when we looked at only the daily factors. Did anyone step back and ponder that the total U.S. inventory of oil and all petroleum products hit a 27 year high according to the EIA?
Now just stop and think where the price of oil was 27 years ago and what kind of world we lived in 1983. Some things were different but some are the same. Ronald Regan was president and had just lifted wage and price controls on oil. It was the first year that the NYMEX had offered futures contracts on crude, the price per barrel was hovering around $30 a barrel. We were just emerging out of the of a 4 year recession that saw rapid job destruction and an unemployment topped out at 10.8%. Sound familiar.....Read the entire article.
Crude oil was higher due to short covering overnight as it consolidates some of this month's decline. Stochastics and the RSI are oversold and are turning neutral to bullish signaling that a short term low might be in or is near.
Closes above the 20 day moving average crossing at 78.59 would confirm that a short term low has been posted. If September extends the aforementioned decline, the 75% retracement level of the May-August rally crossing at 72.96 is the next downside target.
First resistance is the 10 day moving average crossing at 77.36
Second resistance is the 20 day moving average crossing at 78.59
Crude oil pivot point for Thursday morning is 75.00
First support is Wednesday's low crossing at 73.83
Second support is the 75% retracement level of the May-August rally crossing at 72.96
Trading commodities and indexes through the use of exchange traded funds sure keeps things simple for an average trader. These funds allow individual investors to buy and sell things like gold, silver, oil, the sp500 and other investments which where not available only few months ago like “wheat” for example.
One of the nice things with ETFs is that they allow everyone to follow the price of a commodity or index using any charting website and can even apply indicators to help spot key support and resistance levels using volume by price analysis. There is no need for a expensive data feeds, charting programs and you don’t have to worry about contract expiration.
Below are a few charts of the trend and my short term forecast.....
GLD – Gold Bullion ETF
As you can see gold broke out of its support zone this week and popped into the next resistance level. This is very typical price action in the stock market. It is important to look at the price charts like an apartment building. It’s nothing but a bunch of floors and ceilings.
How it works; if a ball breaks though a floor it will naturally fall to the next floor and bounce. The same for if a ball breaks through a ceiling, it will hit the next ceiling then bounce back down. This is essentially how the market moves.
SLV – Silver ETF
Silver is forming a large pennant and nearing its apex. With the amount of volume traded within this large volume channel I would expect a sharp breakout once a direction is made.
USO – Oil Traded Fund
Crude oil had a funky day. Early Wednesday morning in pre-market trading we saw virtually every investment drop at the same time which was strange. Anyways the US dollar dropped sharply and oil when down also. Normally as the dollar drops oil rockets higher but that was not the case today.
Currently oil is trading between two trendlines and is trying to hold up. If we get a breakdown then we could see a sharp drop in oil over the next 1-2 weeks.
SPY- SP500 ETF Trading Fund
The SP500 is trading within a high volume channel, similar to silver. Once a breakout in either direction is made I would expect a sizable move lasting a few weeks.
Mid-Week Commodity and Index ETF Report
In short, the market looks bearish for the short term of 5-10 trading sessions. This is because everything looks to be trading near resistance levels. That naturally brings sellers out of the woodwork putting pressure on prices.
Silver and gold stocks tend to lead the metals sector on breakouts so it will be important to keep an eye on them as we near a possible breakout or breakdown in the metals. If you see SLV or GDX ETFs out performing the GLD gold fund by 2-3x then I would expect to see gold move higher later that session or the following day.
The US dollar trend usually helps to identify if oil will have downward pressure or not. Also energy stocks tend to lead the price of oil by a few hours and some times a day. I keep an eye on XLE energy etf for a feel of how the energy stocks are doing and also UUP US dollar fund.
As for equities tech, financials and the Russell 2K (small cap stock) tend to lead the way for the broad market. Watching XLK, XLF and IWM help to confirm breakouts.
