Phil Flynn: Old Risks Return

Something old something new something bullish and something blue. The bulls have wrestled control of the petroleum markets with a slew of bullish news and some strong technical formations driving oil to a three month high. With the market focused on the bailout of Europe the risk to supply is increasing as tension between Israel and Iran are heating up. In fact for oil the situation with Iran and the violence in Nigeria and Syria may be a better reason to be long than the European charades. European finance chiefs continue to work on details increase the European Financial Stability Facility by$1.4 trillion.

Oh sure we know the new economic maxim that bailouts are bullish yet as the market awaits the fate of Italian Prime Minister Berlusconi and who the New leader of Greece is going to be it may be the fate of Iran that may present more risk. Debate is raging in Israel on whether they should attack Iran as the regime once again lied to the world about their nuclear intentions. According to Intelligence provided to U.N. nuclear officials Iran has mastered the critical steps needed to build a nuclear weapon. Israel feels that they may be the target and the risk of a conflict is being priced into oil.

Nigeria continues to be a risk as well recent violence by Islamic fundamentalists is putting supply at risk. Reuters' news reports that " Nigeria's national security adviser on Monday dismissed a weekend warning from the United States of an Islamits bomb threat to luxury hotels in the capital as "not news," and said it was spreading unnecessary panic. The attacks were the deadliest since Islamist sect Boko Haram launched an insurgency against the government in 2009. The group claimed responsibility for the violence that left bodies littering the streets and police stations in ruins.

Witnesses reported gunfire in the city again on Monday, but military sources said it was from guards at the Yobe state governor's house firing at a suspicious speeding car, and gave no further details."The (U.S. statement) is eliciting unhealthy public anxiety and generating avoidable tension," said Owoeye Andrew Azazi, Nigeria's national security adviser. "The ... government wants to advise members of the public that it (will) continue to ensure security of lives and property under its jurisdiction."


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How Cheap is Natural Gas?

How cheap is natural gas? The EIA tells us winter (November-March) natural gas futures prices are near their lowest levels since 2001-2002.

The average natural gas futures price for the upcoming winter is less than $4 per million British thermal units, the lowest level entering the winter since 2001-2002. The so called "winter strip," the average natural gas futures price for the contract months November through March as settled on the New York Mercantile Exchange is a closely followed measure of market participants' price expectations.

In markets such as New England and California, where natural gas prices often set on peak, wholesale power prices, the NYMEX winter strip for natural gas also can influence expectations for forward wholesale power prices.

Source: U.S. Energy Information Administration, based on Bloomberg, L.P.
Note: October 20 was selected because it represents a date near the start of the natural gas winter heating season yet still has information for five months of the upcoming winter's natural gas NYMEX future's strip.


These prices do not reflect expectations for the cost of transporting natural gas from Henry Hub to downstream market locations. The Henry Hub, in Erath, Louisiana, is the physical delivery location for the NYMEX natural gas futures contract. Sabine Pipeline is the operator of the Henry Hub. 

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Crude Oil Bulls Take Solid Near Term Advantage

Crude oil closed up $1.25 a barrel at $95.51 today. Prices closed nearer the session high and hit a fresh three month high today. Crude bulls have the solid overall near term technical advantage and gained more upside momentum today. Prices are in a five week old uptrend on the daily bar chart.

Natural gas closed down 8.6 cents at $3.697 today. Prices closed nearer the session low today and scored another fresh contract low. The bears have the solid overall near term technical advantage.

December gold futures closed up $35.90 an ounce at $1,792.10 today. Prices closed near the session high today and hit another fresh six week high. Strong safe haven buying interest was seen amid the EU turmoil that is now focusing on Italy. Bulls have solid the overall near term technical advantage and gained more upside technical momentum today.


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Phil Flynn: Will He Stay Or Will He Go

No Not Papandreou he was so over the weekend. No the question is all about Italian Prime Minister Silvio Berlusconi.

While Greece has a new coalition government in place now the focus is on Italy and whether Italian Prime Minister Silvio Berlusconi will resign and open up the gridlock that has slowed the reforms that are needed to keep Italy of becoming more like Greece.

The markets have a lack of confidence in Berlusconi after many broken promises on reform and rallied on the prospect that Berlusconi was gone. For oil it is headline to headline.
We will be looking to play ranges!


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How to Trade This Headline Driven Stock Market

With all eyes on the unemployment report and Europe, the CME Group’s PR Department nearly created an all out panic with their announcement after the market close on Friday relating to futures maintenance margin. The original statement was vague and I was quite concerned until I checked out the CME Group’s web page and the PR Department sent an update clarifying their position. At this point I think the crisis has been averted, but this is just another reminder that we live in “interesting times.”

Keep in mind that if the CME starts raising margin rates across the board for futures contracts in order to protect themselves stocks and commodities could collapse. Silver recently has is margin rates increased and silver since then dropped 25% in value. So imagine if they raised the rates for more commodities…

The current price action in the marketplace pales in comparison to the world’s geopolitical tensions and deteriorating social mood. 

In my trading career, I have never seen the price action in the indices react so violently to intraday headlines and rumors. Risk is high and the types of traders profiting from this market are day traders and very short term traders with trades lasting just a couple hours to 24 hours in length. Aggressive trading which small position sizes is all that can be done right now. This is not meant to be investment advice, but more as a function of the market environment in which we find ourselves currently trading within.

Right now it is hard to say where price action in the broader indices heads in the short run.  One headline out of Greece or Italy could dramatically alter economic history. In the intermediate term I remain neutral to bearish for a number of reasons. One indicator I follow is the bullish percent index on the S&P 500 which at this point is arguing for lower prices.

The chart below illustrates the S&P 500 Bullish Percent Index:

As can be seen above, the S&P 500 Bullish Percent Index is presently at an overbought status. When looking at the relative strength and full stochastics indicators one would argue that a pullback is warranted. Historically when the S&P 500 Bullish Percent Index is this overbought, a pullback ensues which ultimately sees the S&P 500 Index selloff. The more arduous task is trying to determine just how deep the pullback on the S&P 500 Index might be.

It is critical to point out that while I do believe a pullback is likely, I will not rule out a rally into the holiday season. Much of the near term price action is going to be dictated by headlines coming out of Greece and the rest of Europe. In addition to Greece, Italy is also starting to see increased concern regarding an unsustainable fiscal condition. Depending on how the European Union handles the varying degrees of risk in the near term, we could see price action react violently in either direction.

With the market capable of moving in either direction, I wanted to point out some key price levels which should act as clues regarding potential future price action in the S&P 500. The two key support levels to monitor on the S&P 500 Index are the 1,240 and 1,220 price levels.

The daily chart of the S&P 500 Index below illustrates the price levels:

For bullish traders and investors the key price level to monitor is the recent highs on the S&P 500 around the 1,290 area. The weekly chart below demonstrates why this price level is critical and which overhead levels will offer additional resistance should the recent highs be taken out to the upside.

SP500 Weekly Chart Analysis:

While I am neutral in the intermediate to longer term presently, in the short run I have to lean slightly bearish simply because of the future headline risk and also because a major head and shoulders pattern has been carved out on the hourly chart of the S&P 500 Index. This type of chart pattern is synonymous with bearish price action.

The hourly chart of the S&P 500 Index is shown below:

Right now I remain slightly bearish, but should the head and shoulders pattern fail and/or we begin to see multiple positive reactions to news coming out of Europe a strong rally into the holiday season is likely. Unfortunately all we can do is monitor the key price levels and wait patiently for Mr. Market to tip his hand.

Until we see a breakout in either direction, we could see price action inhabit the 1,220 – 1,290 price range for several weeks before we get any more clarity of future direction. Until I see a breakout, I will remain relatively neutral with a slight short term bias to the downside based on price patterns in the shorter term time frames. This is a tough market to trade in, and I don’t want to get chopped around or do any heavy lifting. I’m going to focus my attention on high probability, low risk trade setups until directional biased trades make more sense.

In closing, I will leave you with the thoughtful muse of the late Texas Congresswoman Barbara Jordan,

“For all of its uncertainty, we cannot flee the future.”

Market Analysis and Thoughts By:

Chris Vermeulen – ETF Trading Videos & Trade Alerts

JW Jones – Options Trading videos & Options Alerts

Ex-Credit Suisse Oil Head McKenna Starts Mastic Hedge Fund

Kieran McKenna, who traded oil for Credit Suisse AG and JPMorgan Chase & Co., started a hedge fund that will accept money from outside investors next month, according to Mastic Investment Advisory AG, his new company.

The Mastic Commodity Fund, based in Zug, Switzerland, will begin trading oil and energy products this month with partners’ capital, Mastic Investment said in an email. McKenna resigned from Credit Suisse as global head of oil in July to set up the firm. He declined to give details on the fund’s size or targets.

McKenna, 36, joins ex bankers from firms including Goldman Sachs Group Inc. and Morgan Stanley who have set up hedge funds after the Volcker rule limited risk taking by banks following the collapse of Lehman Brothers Holdings Inc. in 2008.

“We have seen no let up in appetite from investors looking to back new ventures if you can present them with managers with a good pedigree and track record,” said Daniel Caplan, a managing director in London for Deutsche Bank AG’s unit that provides leverage to hedge funds and helps them raise money from investors. “That’s true across all asset classes.”

Money managers founded 578 new hedge funds in 2011 through June, the best six months for startups since the first half of 2007, according to data from Chicago based Hedge Fund Research Inc. that covers all types of hedge fund.

The Mastic fund will make “extensive use” of options and has a relative value biased strategy, according to the company’s email. “There are contrasting outlooks from the fundamental hydrocarbon supply and demand balance issues that remain unresolved,” McKenna said.

Brent-WTI Spread

Relative value investment strategies seek to profit by targeting price gaps between different commodities, or different grades of the same commodity. They can also seek to exploit differences between maturity dates for the same commodity.

West Texas Intermediate crude, the U.S. benchmark grade, rallied 18 percent last month as U.S. demand increased and inventories declined in Cushing, Oklahoma. The December contract traded at $94.33 a barrel at 12:14 p.m. in London.

The gap between WTI and costlier Brent, the standard for more than half of the world’s crude, reached a record $27.88 a barrel on Oct. 14 and was at $17.45 today. Cushing is the largest crude-trading and storage hub in the U.S.

McKenna’s partners in Mastic Investment are John Thompson and Erik Serrano Berntsen, who founded Energy Alpha Strategies Ltd., a London based, commodity focused investment firm. Berntsen is chief operating officer at Mastic Investment.

McKenna’s departure from Credit Suisse came after the Zurich based bank replaced an almost five year trading alliance with Glencore International AG, the world’s largest commodities trader, with a so called consulting agreement in January.

He joined Credit Suisse in 2008 from JPMorgan and became global head of oil and products for the alliance. He was also a senior oil trader at Citadel LLC in Chicago and London. McKenna started his career in 1997 at Goldman Sachs, where he traded North Sea crude and options, according to Mastic Investment.


Posted courtesy of Bloomberg BusinessWeek News.

ONG: Recent Developments Support Gold's Outlook

The G-20 summit ended Friday mainly focused on the sovereign debt crisis in the Eurozone. Two critical developments we observed were Italy's acceptance of surveillance and monitor by the IMF, as well as the failure to agree on the use of IMF resources. Both are expected to affect market sentiment towards the 17 nation region.

In the IMF program to monitor Italy's progress of the reforms, the world lender will provide independent and frequent assessments of the economic and financial conditions of Italy. It will also review on the Italian government's implementation of the fiscal policy such that credibility will be built up in the government regarding policy implementation.

The G-20 communiqué stated that G-20 countries 'stand ready to ensure additional resources could be mobilised in a timely manner'. The various channels that countries can contribute to the IMF include bilateral contributions, SDRs, and voluntary contributions to an IMF special structure such as an administered account.

AS happened last week was Greece's announcement and cancellation of the referendum of the EU agreement, FOMC meeting as well as ECB meeting. We will discuss in the precious metal section on these issues and their impacts on gold price......Check out Oil N'Gold.Com's commodities price movement charts.


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Crude Oil Bulls Seem to Lack any Strong Conviction on the Upside

The crude oil market continues to inch higher, but seems to lack any strong conviction on the upside. Our short term Trade Triangle moved into a positive position moving the Chart Analysis Score to a +70. However, the December contract for crude oil remains in a trading range bound by $90 a barrel support on the downside, and $95 a barrel resistance on the upside.

With a score of +70 this market maybe trying to move out of its broad trading range. Depending what happens to equity markets and the global economy will likely be reflected in this commodity. Intermediate term traders should be on the sidelines and long term traders should continue to be short the crude oil market.

Monthly oil Trade Triangles for Long Term Trends = Negative
Weekly oil Trade Triangles for Intermediate Term Trends = Positive
Daily oil Trade Triangles for Short Term Trends = Positive
Combined Strength of Trend Score = + 70

Watch todays video covering crude oil and all six markets we cover publicly.


Today’s Stock Market Club Trading Triangles

Sinopec, PetroChina Rise on Speculation Government to Change Fuel Pricing

China Petroleum and Chemical Corp., Asia’s biggest refiner, rose the most in almost three years in Hong Kong trading on speculation the state may allow fuel suppliers including PetroChina Co. to adjust prices on their own.

Sinopec, as China Petroleum is known, gained 8.3 percent, the largest increase since Dec. 8, 2008, to HK$7.92 at the close. PetroChina climbed 3.9 percent, while Cnooc Ltd. (883), whose parent operates a refinery, advanced 5.1 percent. The benchmark Hang Seng Index climbed 3.1 percent.

China, which controls fuel prices to curb inflation, may permit refiners to make “appropriate” changes, China Securities Journal reported, citing an unidentified person. This would mark a further move toward market oriented pricing after China introduced a system in 2008 that linked government mandated changes to swings in benchmark crude prices.....Read the entire Bloomberg article.


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Phil Flynn: Kicking The Cannes Down The Road

Global markets are trying to recover as the ECB provides some cover for the Greeks with a surprise rate cut against a backdrop of some better than expected US economic data. Europe was trying to continue to kick the Greek can down the road and tried to end the charade with a package to head off a Greek default.

Greek PM Papandreou created a world of turmoil proposing a referendum of the EU handouts as the markets gyrated headline after headline. The Greek people want a bailout but they don't want to make the spending cuts that will be necessary. Austerity is no fun, especially when you think you hold Europe and the world hostage and that you can still have your cake and eat it too.

Rumors that Papandreou would resign or that the referendum was off the table created wild swings and crazy things. Yet ECB cut rates helped restore sanity in an insane world.

The market also hoped that the G20 would do the Cannes can and help provide confidence to the global market place. The AP reports, "The United States, China, Germany and other major rich and emerging economies have pledged to fight cross border tax evasion under an agreement approved Friday, which supporters say could raise tens of billions of dollars at a time when indebted European nations are scrambling for more revenue.

The deal approved during the Group of 20 summit adds to a marathon campaign by the United States and the European Union to pressure Switzerland and other tax havens to scrap practices they say help wealthy individuals and companies hide income. Supporters say the agreement could help governments collect tens of billions of dollars in taxes on previously hidden income......Read the entire article.


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Transocean Drops on Biggest Earnings Miss in Half a Decade

Transocean Ltd. (RIG), the world’s largest offshore oil driller, fell the most in almost three years after third quarter earnings missed analysts’ estimates by the biggest margin in at least half a decade.

Transocean declined 12 percent to close at $49 in New York. Earlier, the stock plunged as much as 14 percent for the worst intraday performance since November 2008. After regular trading on U.S. markets closed yesterday, the company posted a loss of $71 million, or 22 cents a share, its largest third quarter loss in at least 10 years.

Excluding one time items such as foreign exchange contract costs associated with last month’s Aker Drilling ASA acquisition, the Vernier, Switzerland based company recorded per share profit of 3 cents, 73 cents lower than the average of 32 analysts’ estimates compiled by Bloomberg.

The company “did not deliver” in the third quarter, Chief Executive Officer Steven Newman told analysts and investors on a conference call today.

Manufacturing delays among equipment providers prolonged downtime for rigs subject to more stringent U.S. safety rules imposed in the wake of last year’s Macondo disaster in the Gulf of Mexico, Newman said........Read the entire Bloomberg article.



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Rigzone: Crude Rises On Host Of Positive Economic News

Crude oil futures rose in volatile early trading Thursday on a host of bullish economic news, including a drop in initial jobless claims, an increase in business productivity and a European interest rate cut.

Light, sweet crude for December delivery was up $1.49, or 1.6%, at $94.00 a barrel on the New York Mercantile Exchange. Brent crude on the ICE Futures Europe exchange was up $1.28, or 1.2%, at $110.62 a barrel.

The U.S. said initial jobless claims fell 9,000, to 397,000 in the week ended Oct. 29, slightly lower than analyst expectations of 400,000. Productivity for the quarter was up 3.1% at an annualized rate, and the ECB reduced interest rates by a 0.25 percentage point to 1.25%.

Summit Energy analyst Matt Smith called the European Central Bank's move an "absolutely fabulous curveball" and said it would likely be good for oil prices. "It shows that the ECB not only acknowledges the frailty of the region's economy, but is willing to take whatever steps needed to promote stability," he said in a note......Read the entire Rigzone article.


How To Find Winning Trades In Any Market

Crude Oil Bulls Hold The Near Term Advantage

Crude oil closed higher on Thursday while extending the trading range of the past seven days. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are possible near term.

If December extends the rally off this month's low, the 50% retracement level of the May-October decline crossing at 95.32 is the next upside target. Closes below the 20 day moving average crossing at 89.04 are needed to confirm that a short term top has been posted.

First resistance is the 50% retracement level of the May-October decline crossing at 95.32. Second resistance is the 62% retracement level of the May-October decline crossing at 100.08. First support is the 20 day moving average crossing at 89.04. Second support is the reaction low crossing at 83.40.


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Trends in Eagle Ford Drilling Highlight the Search for Oil and Natural Gas

Rapid growth in horizontal drilling at the Eagle Ford shale formation in Texas, like activity described in the previous story on the Bakken formation, has resulted in significant increases in crude oil and natural gas production. Increasing natural gas volumes have also boosted production of lease condensate (recovered as a liquid from natural gas in lease separation facilities) and natural gas liquids (extracted further "downstream" at natural gas processing plants).

The animated map shows that the Eagle Ford shale comprises three "windows" (roughly parallel acreage swaths). Production from these windows is increasingly liquids rich moving generally from south to north. The circular yellow and green producing well markers signify the more "oily" wells, with the red markers representing wells that produce mostly natural gas.

Eagle Ford Shale Drilling & Production (click image to animate)

 In 2007, total Eagle Ford liquids production (crude oil and condensate) was less than 21 thousand barrels, none of which was from horizontal wells. In 2010, production averaged nearly 29 thousand barrels per day (bbl/d), and was approaching 60 thousand bbl/d by year's end; virtually all was from horizontal wells. Production continues to rise in 2011; according to the Railroad Commission of Texas, Eagle Ford liquids production averaged 74 thousand bbl/d through July.


In major shale plays, drilling activity depends largely on the resource mix and relative fuel prices. For example, drilling in the Barnett shale focuses on natural gas. By contrast, operators in the Bakken formation tend to drill mainly for crude oil. In the Eagle Ford, however, the animation underscores how operators target a combination of crude oil, condensate, and natural gas liquids due to their relative price premium over natural gas. 


Source: U.S. Energy Information Administration, based on data from HPDI, LLC.

Note: Dot color is determined by the well's gas oil production ratio, or the volume of natural gas produced relative to oil. The higher the ratio (from green to red), the more gas is being produced. Dot size represents the well's production volume: either gas measured in barrels of oil equivalent per day (BOEPD) or oil measured in barrels. The lower right inset graph represents combined oil and natural gas production on a BOEPD basis.

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Phil Flynn: Greased Lightening!

Greece throws the world in turmoil as France and Germany says that the Greece referdum is a vote on whether Greece wants to stay in the Euro Zone. In the mean time, Big Bad Ben Bernanke says that QE 3d is a real possibility as he lowers the growth and jobs forecast for the US economy. The Energy Information agency added a few surprises with a big build in crude oil and a disturbing drop in distillates that could send chills across your spine if you heat your home with heating oil. Yet the markets seemr to hope that the nova convening G20 can bring order back to the market place in a world where we don't know where the next crisis might come from.

Now austerity is one issue but having a sugar daddy to pay your bills is another. Greek PM Papandreou threw caution to the wind for what purpose no one is quite sure. If it was to save his political backside well perhaps he is one. European leaders on the other hand reframed the debate by telling the people of Greece that the referendum vote about the Greek bailout package may be a vote on whether they want to be in or out of the EU.

German Chancellor Angela Merkel and French President Nicolas Sarkozy has pulled the plug on the euro zone rescue aid driving Greek bonds to 100% and perhaps putting the country on the verge on bankruptcy. Sarkozy says that there will be, "no French taxpayer money, no German taxpayer money" until the question is answered. In the meantime global markets tank but are finding hope that somehow the G20 will restore sanity or a split in Papandreou inner circle might find hope that Greece will accept its partners handout.....Read Phil's entire article.

Wednesday Market Summary - Crude Oil , Natural Gas and Gold

Crude oil closed higher on Wednesday while extending last week's trading range. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are possible near term.

If December extends the rally off this month's low, the 50% retracement level of the May-October decline crossing at 95.32 is the next upside target. Closes below the 20 day moving average crossing at 88.48 are needed to confirm that a short term top has been posted.

First resistance is the 50% retracement level of the May-October decline crossing at 95.32. Second resistance is the 62% retracement level of the May-October decline crossing at 100.08. First support is the 20 day moving average crossing at 88.48. Second support is the reaction low crossing at 83.40.

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Natural gas was lower on Wednesday while extending October's trading range. Stochastics and the RSI are turning neutral signaling that sideways trading is possible near term. Closes above the reaction high crossing at 4.039 are needed to confirm that a short term low has been posted.

If December renews this year's decline, monthly support crossing at 3.225 is the next downside target.

First resistance is the 25% retracement level of the June-October decline crossing at 4.133. Second resistance is the 38% retracement level of the June-October decline crossing at 4.336. First support is last Thursday's low crossing at 3.724. Second support is monthly support crossing at 3.225.

How to Use Money Management Stops Effectively

Gold closed higher on Wednesday and 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 additional strength is possible near term.

If December extends the rally off September's low, the 62% retracement level of the 2008-2011 rally crossing at 1775.20 is the next upside target. Closes below the reaction low crossing at 1604.70 would confirm that a short term top has been posted.

First resistance is the 62% retracement level of the 2008-2011 rally crossing at 1775.20. Second resistance is the 75% retracement level of the 2008-2011 rally crossing at 1826.50. First support is the reaction low crossing at 1604.70. Second support is September's low crossing at 1535.00.

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Gold Ready to Attack Prior Highs in the 1900’s

From David Banister at Market Trend Forecast.......

It’s been several weeks since I’ve written about Gold and we have had a wild ride since the 1910-1920 highs in August.  At the time as we approached I forecasted a major correction was nigh and we were shorting the rise from 1862-1910 prior to a huge $208 drop that took place over just a few days.  We covered our short at $1725 and then Gold rallied back to a double top at $1920 and then fell back to $1531.

That pullback to $1531 qualifies as a Fibonacci retracement of the 34 month rally from $681 to $1920, and would also qualify for a price low for a 4^th major wave correction that I discussed in prior forecasts.  My initial targets for the Gold pullback were $1480-$1520 if the $1650 area was violated.  Most recently we have seen Gold run up to 1681 which is another Fibonacci resistance zone a few times and then back off to the low $1600’s.

With the recent push over $1681, we can now confirm the 4^th wave is over at $1531 lows and that the 5^th wave is likely in the very early stages, but beginning to build steam. I will say that we want to make sure the 1650-1680’s areas are defended by Gold on any pullbacks in order for this forecast to remain valid.  During this 5^th wave up, eventually we should see the $2380 ranges in Gold, but it will not take place overnight.  In the next few months I am looking for Gold to attack the $1900 range, possibly even by year end, and then in 2012 attacking the $2000 plus ranges.

With all of the Macro events in Europe changing on an almost daily basis, the whipsaws in both the precious metals and equities markets are difficult to forecast and trade for most investors. However, Gold has been moving in defined Fibonacci and wave patterns for ten years now, and has about three years left in a 13 year bull cycle if I’m right.

Below is the updated weekly chart of Gold.  You can see prior low’s as they related to oversold indicators, and where we just came off the 1531 lows and its Fibonacci pivot along with the oversold indicators below.

Look for Gold to attack 1775 first, then 1800, 1840, then 1900 in the coming 6-10 weeks or so.

Gold Forecast

You can get 3-5 updates a week on Gold, SP500, and Silver by visiting my website at Market Trend Forecast

Check out David's latest articles at "The Market Trend Forecasts"

Crude Oil Bulls Cling to a Technical Advantage After a Rough Go in Tuesday Trading

Crude oil closed down $2.34 a barrel at $90.86 on Tuesday. Prices closed near mid range today and saw more profit taking pressure from recent gains. A higher U.S. dollar index and weaker stock indexes pressured crude again today. Crude bulls still have the overall near term technical advantage, but are fading and need to show fresh power soon.

Natural gas closed down 14.7 cents at $3.782 today. Prices closed nearer the session low today. The bears still have the solid overall near term technical advantage.

Gold futures closed down $6.60 an ounce at $1,719.20 today. Prices closed nearer the session high today after being under stronger selling pressure early on today. The market was pressured by a stronger U.S. dollar index and lower crude oil prices.

Profit taking from recent gains in gold was seen again today. No chart damage has occurred this week. Bulls still have the overall near term technical advantage. A five week old uptrend is still in place on the daily bar chart.

Phil Flynn: Confidence Game

When it comes to the markets confidence is key. Yet obviously if you look at the last 24 hours confidence has been shaken. Whether it be the call for a Greek referendum on the EU bailout or the weakness in the Chinese manufacturing data or the situation with the bankruptcy of MF Global confidence has been shaken. And despite the blow to confidence, the markets are something that you can believe in. You can also believe in the protections offered the customer provided by the exchanges.

The oil market, despite the absence of MF Global traders, had a very low volume and oil prices acted like they would have if all traders were present. They reacted as you might expect to the movement from the Japanese yen and dollar intervention and the economic data. They reacted to strong Libyan oil production that rose 245,000 barrels to 345,000, the highest level since March. Or strong production out of Iraq and the highest OPEC oil production since 2008.....Read Phil's entire article.


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Crude Oil Declines Below $90 on China Manufacturing Slowdown, European Debt

Crude oil fell below $90 a barrel for the first time in a week in New York on speculation commodity demand will falter as Chinese manufacturing slows and European leaders struggle to contain the region’s debt crisis.

Futures slid as much as 3.8 percent, after posting their biggest gain last month since May 2009, amid signs of higher production from OPEC members as Libya bolstered exports. China’s Purchasing Managers’ Index fell for the first time in three months in October, a report showed. Greek Prime Minister George Papandreou said he will submit the European Union’s new financing deal for a national referendum.

“The list of things weighing on the market is long,” said Olivier Jakob, managing director at Petromatrix GmbH in Zug, Switzerland, who correctly predicted that this year’s oil rally would stall. “There’s the Chinese PMI, the Greek referendum taking EU leaders by surprise, the euro-dollar collapsing.”

Oil for December delivery declined as much as $3.56 to $89.63 a barrel in electronic trading on the New York Mercantile Exchange and was at $90.56 as of 12:48 p.m. London time. Futures fell 0.1 percent yesterday and climbed 18 percent in October......Read the entire article.


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