Oil could retrace before resuming upward trek

Oil, gold, euro and S&P 500 may head lower

Daily Market Analysis Monday 03/05/12

KEY TERMS
OVB     Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar
STT 1   Trend Based on a Range Violation
STT 2   Trend Based on a Close Violation
RBB     Resistance Bollinger Band
SBB     Support Bollinger Band

ENERGIES

CLJ12:

  • STT 1 and STT 2 Trends are bullish.
  • Possible STT 1 confirmation of a top with a range violation @ 105.79. Possible STT 2 confirmation of a top with a close @ 105.79 or lower.
    • April Crude seemed to lose its luster at the end of the week after false reports of a Saudi pipeline rupture spooked the market late Thursday before dropping $5 in the next 24 hours to end the week lower.
    • Crude has hit 85% of our weekly target of 113.59 from the bottom in December and if the market breaks last week’s low should move back to 101.29 before resuming its move higher.
  • Projected Daily Range: 3.27
  • Projected Weekly Range: 5.71
  • Projected Monthly Range: 10.15

 

NGJ12:

  • STT 1 and STT 2 Trends are bearish.
  • Inside VRCB generated on Friday. Downside Target = 2.223.
    • Natural Gas traded within a very tight range on Friday after moving sharply lower all of last week before finding a little Short Term support on the daily SBB.
    • Gas should try to run the stops below 2.390 and make new contract lows at the beginning of this week.
  • Projected Daily Range: .111
  • Projected Weekly Range: .294
  • Projected Monthly Range: .760

METALS

GCJ12:

  • STT 1 and STT 2 Trends are bullish.
  • Second consecutive inside compression day on Friday. Possible STT 2 confirmation of a top with a close @ 1688.30 or lower.
    • April Gold remained steady on Friday as the market seemed to still be reeling from the massive sell-off last Wednesday as it traded below $1,700 for the first time since January.
    • Based on Friday’s close, Gold should look to try and retest the $1,700/oz. level again to see if any support lingers or if the market will trade lower toward our Short Term downside target of 1,639.70.
  • Projected Daily Range: 20.70
  • Projected Weekly Range: 66.40
  • Projected Monthly Range: 187.10

CURRENCIES

ECH12:

  • STT 1 and STT 2 Trends are bullish.
  • New low made on current move last Friday @ 1.3188. Downside Target@ 1.3149 75% achieved.
    • The euro was pummeled again Friday, dropping over 100 points before finding some support at the prior week’s low.
    • If the Euro falls below 1.3182, the Euro will generate a weekly confirmation of a top and should make a move lower toward our Q1 Downside objective of 1.2153.
  • Projected Daily Range: .0131
  • Projected Weekly Range: .0305
  • Projected Monthly Range: .0653

INDEXES

ESH12:

  • STT 1 and STT 2 Trends are bullish.
  • Possible STT 1 confirmation of a top with a range violation @ 1356.50. Possible STT 2 confirmation of a top with a close @ 1356.50 or lower.
    • The March S&P’s moved lower on Friday but still managed to squeak out an overall gain for the week as heavy selling has come into the market once it trades above 1375.
    • If the S&P’s are hit again above 1375, this market could easily break to violate last week’s low and begin a several day correction back to 1327.
  • Projected Daily Range: 16.25
  • Projected Weekly Range: 23.50
  • Projected Monthly Range: 91.50

 

About the Author
Jim Parrish and Kris Hicks

Parrish Hicks Capital Research is a trading and technical analysis firm that specializes in Energy and Metal commodity futures. The two founders, Jim Parrish and Kris Hicks, have a combined 38 years’ experience in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October. They also called the all-time high day for Gold on September 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012.  Their trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. Their expertise is focused on 16 commodities plus the comparable ETF markets. You can reach them at Jim@ParrishHicks.com and Kris@ParrishHicks.com or at www.ParrishHicks.com.

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