Gold and S&P 500 set up for strong corrections if lows violated

Daily Market Analysis (SHORT TERM) Thursday 03/29/12

Gold chart

KEY TERMS

OVB      Outside Vertical Bar
VRCB   Volatility Reduced Compression Bar

ENERGIES

BRNK12:

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation @ 126.26 on 03/23/2012. Upside Targets = 133.55.
  • Possible confirmation of a top with a range violation @ 123.09. Possible confirmation of a top with a close @ 123.09 or lower.
    • May Brent Crude moved lower on Wednesday due to increased builds in U.S. inventories along with reassurance from the Saudi oil minister that they would do “whatever is necessary” to keep energy prices in check.
    • With Saudi assurances for continued supplies, this recent consolidation in the Brent market could lead to a Short Term correction after a violation of last week’s low @ 122.30.
  • Projected Daily Range: 1.41
  • Projected Weekly Range: 6.17
  • Projected Monthly Range: 10.51

CLK12:

  • Short Term Trends are bullish.
  • Confirmation of a top with a range violation on 03/22/12 @ 105.69. Confirmation of a top with a close on 03/22/12 @ 105.35. Downside Target = 103.54.
  • New weekly lows made on Wednesday @ 104.67. Downside Target 75% achieved.
    • May Crude collapsed lower on Wednesday after one of the largest inventory builds in 6 months and a technical breakdown at 106.88.
    • Like Brent, look for the WTI market to possibly face a Short Term correction after the recent consolidation period with a violation below 104.29.
  • Projected Daily Range: 1.54
  • Projected Weekly Range: 4.45
  • Projected Monthly Range: 10.26

NGK12:

  • Short Term Trends are bearish.
  • Confirmation of a top with a range violation on 03/22/12 @ 2.392. Confirmation of a top with a close on 03/22/12 @ 2.372. Downside Targets = 2.161 – 1.860
  • New contract lows made on Wednesday @ 2.251. Downside Target = 1.860.
    • Nat Gas continued lower on Wednesday as it awaits the supply number in Thursday’s storage report which is expected to set new record storage levels above 700BCF.
    • Our outlook remains the same that gas still should make a solid break to our Q1 2.161 and then on through the $2.00 threshold before it sets a major-term bottom @ 1.799.
  • Projected Daily Range: .078
  • Projected Weekly Range: .222
  • Projected Monthly Range: .690

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