Fed QE3 talk will support technically strong gold

Daily Market Analysis (SHORT TERM) Monday 08/27/2012

 

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.
  • C < LOHB (Close Below Low High Bar) generated on Friday. Possible confirmation of a top with a range violation @ 112.99. Possible confirmation of a top with a close @ 112.99 or lower.
    • October Brent Crude traded to within 13 ticks of the weekly lows on Friday as suggested in Thursday evenings report after a large decline to end the week lower for the first time in 4 weeks.
    • After forming a DOUBLE VRCB bar on the weekly charts since bumping up against our resistance zone beginning at 116.70, Brent should make a move lower down as low as 108.27 over the coming weeks.
  • Projected Daily Range: 2.02
  • Projected Weekly Range: 4.32
  • 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.
  • Possible confirmation of a top with a range violation @ 95.40. Possible confirmation of a top with a close @ 95.40 or lower.
    • October WTI Crude finished the session virtually unchanged after rebounding from trading near the week’s lows to close just slightly below the daily mid-range.
    • Friday’s price action suggest that this market should actually break lower on Monday and see additional selling come into the market until it reaches 93.56 where it may again find some Short Term support after trading just 9 ticks through the extended Q3 objective of 98.20.
  • Projected Daily Range: 1.86
  • Projected Weekly Range: 3.76
  • Projected Monthly Range: 11.71

 

Natural Gas (October):

  • Short Term Trend is bearish.
  • Confirmation of a bottom with a range violation on 08/24/2012 @ 2.897. Confirmation of a top with a close violation 08/02/2012 @ 2.926. Upside Targets = 2.947 – 2.989.
  • Bearish AOVB (Almost Outside Vertical Bar) generated on Friday. Possible confirmation of a top with a range violation @ 2.721.
    • October Natural Gas saw one of its most volatile trading weeks in quite some time last week and was exacerbated on Friday as it made new highs for the week followed by a sharp decline to close at its lowest level since late June.
    • As mentioned in all of last week’s reports, the rally in prices was not expected to be sustainable and traders should look for this market to break through last week’s low of 2.722 on towards the monthly downside objective of 2.612 and then the Q3 target of 2.563.
  • Projected Daily Range: .147
  • Projected Weekly Range: .239
  • Projected Monthly Range: .629

 

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