Gold appears ready for larger upside move

 

Daily Market Analysis (SHORT TERM) Tuesday 08/21/12

 

KEY TERMS

OVB      Outside Vertical Bar

VRCB   Volatility Reduced Compression Bar

 

 

ENERGIES

 

Brent Crude Oil (October):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 07/27/12 @ 106.19. Confirmation of a bottom with a close violation on 07/27/12 @ 106.47. Upside Target = 114.37 – 118.06.
  • Inside compression day generate don Monday. Possible confirmation of a top with a range violation @ 112.69. Possible confirmation of a top with close @ 112.69 or higher.
    • October Brent Crude settled virtually unchanged on Monday closing down a penny on the day amid Eurozone uncertainty.
    • Preliminary data from Reuters shows that crude supplies most likely rose last week and with European politicians back from their summer recess; look for this market to hinge on whatever new headlines arises from overseas.
  • Projected Daily Range: 1.88
  • Projected Weekly Range: 4.84
  • Projected Monthly Range: 13.99

 

WTI Crude Oil (October):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 08/15/12 @ 94.15. Confirmation of a bottom with a close violation on 08/15/12 @ 94.33. Upside Targets = 98.20 – 101.26.
  • New highs made on the current move Monday @ 96.83.
    • October WTI Crude traded within just 7 cents of generating a daily OVB in early trading on Monday before closing stronger on the day back above the daily mid-range yet below Friday’s close.
    • WTI should be able to continue to rise on Tuesday ahead of Wednesday’s EIA storage report as it tracks down our Short Term target of 98.20.
      • It is important to note, however, that the short-term rate of change has begun to roll over to bearish as the market has traded through the initial Q3 target of $95.53 and could see some signs of resistance soon.
  • Projected Daily Range: 1.55
  • Projected Weekly Range: 4.38
  • Projected Monthly Range: 11.71

 

Natural Gas (September):

  • Short Term Trend is bearish.
  • Confirmation of a top with a range violation on 08/02/2012 @ 3.122. Confirmation of a top with a close violation @ 2.979. Downside Targets = 2.871 – 2.790 – 2.612**.
  • Bullish OVB generated on Monday.
    • September Natural Gas failed to break through last week’s low by a single tick on Monday as it reversed course in early trading as it closed near last week’s mid-range.
    • With the market clearly defining Short Term support at $2.70, natural gas will have to close above Monday’s high of 2.785 on Tuesday in order to reverse the close indicator back to bullish and support a move higher through last week’s high of 2.848.
  • Projected Daily Range: .108
  • Projected Weekly Range: .330
  • Projected Monthly Range: .629

 

METALS

 

COMEX Gold (December):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 08/17/12 @ 1622.10. Confirmation of a bottom with a close violation on 08/20/12 @ 1623.00. Upside Targets = 1644.20 – 1657.20.
  • TREND REVERSAL to bullish with a close @ 1623.00.
    • December Gold generated a bullish OVB on Monday after trading back near last week’s mid-range before rallying back throughout the session to close at its highest level in over a week.
    • If gold is able to continue higher on Tuesday and break through to close above last week’s high of 1628.20, this could finally set up the Intermediate Term move higher to 1721.90 we have been expecting for almost a month.
  • Projected Daily Range: 13.90
  • Projected Weekly Range: 33.90
  • Projected Monthly Range: 105.00

 

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