KEY TERMS
OVB Outside Vertical Bar
VRCB Volatility Reduced Compression Bar
Brent Crude Oil (November):
- Short Term Trends are bearish.
- Confirmation of a bottom with a range violation on 10/05/12 @ 112.70. Confirmation of a bottom with a close violation on 10/09/12 @ 113.41. Upside Targets = 117.97 – 118.88
- TREND REVERSAL to bullish @ 113.40. Upside Target = 117.01.
- November Brent Crude roared back higher on Tuesday to close at its highest level in more than three weeks as tensions in the Middle East continue to rise and technical trends have not reversed back to bullish.
- Expect a modest setback on Wednesday before the EIA storage report as some profit taking comes into the market and then resume the rally to make a move back near the contract highs @ 117.95.
- Projected Daily Range: 2.36
- Projected Weekly Range: 6.82
- Projected Monthly Range: 12.02
WTI Crude Oil (November):
- Short Term Trends are bearish.
- Confirmation of a bottom with a range violation on 10/09/12 @ 91.85. Confirmation of a bottom with a close violation on 10/09/12 @ 92.39. Upside Targets = 94.56 – 95.72.
- November WTI Crude Oil slightly closed the spread between itself and Brent on Tuesday as it rose over $3 as the Middle East remains on edge.
- Should WTI trade above last week’s high of $93.33 it would fulfill only a 14% probability of a weekly OVB failure and point the crude market higher over the next few weeks to $95.72.
- Projected Daily Range: 2.67
- Projected Weekly Range: 6.15
- Projected Monthly Range: 11.33
Natural Gas (November):
- Short Term Trend is bullish.
- Confirmation of a top with a range violation on 10/05/12 @ 3.347. Confirmation of a bottom with a close violation on 09/25/12 @ 3.105. Upside Targets = 3.602 – 3.747.
- C > HOLB (Close Above High Low Bar) generated on Tuesday. Possible confirmation of a bottom with a range violation @ 3.516.
- November Natural Gas once again found solid support under $3.35 on Tuesday as it rallied sharply higher in the second half day of trading on speculation of a colder winter than last year.
- While we expect natural gas prices to continue to rise in the short term, this current contract should experience extreme difficulty breaking through the topside of the resistance zone near $3.75 as there remains adequate storage supplies as well as the fact that a colder winter when comparing to 2011 could still remain pretty mild historically.
- Projected Daily Range: .124
- Projected Weekly Range: .328
- Projected Monthly Range: .624
METALS
COMEX Gold (December):
- Short Term Trends are bullish.
- Confirmation of a top with a range violation on 10/09/12 @ 176810. Confirmation of a top with a close violation on 10/09/12 @ 1765.00. Downside Targets = 1738.00 – 1728.00
- December Gold fell for the 3rd straight day on Tuesday as the market has dropped over $30 from last Friday’s high as technical resistance at $1800 has applied pressure on the market.
- Look for gold to continue lower on Wednesday based on the bearish price action as the market tracks the correction mentioned in this Monday’s report down to new 4 week lows.
- Projected Daily Range: 19.20
- Projected Weekly Range: 45.10
- Projected Monthly Range: 95.30
Euro FX (December):
- Short Term Trends are bearish.
- Confirmation of a top with a range violation on 10/09/12 @ 1.2944. Confirmation of a top with a close violation on 10/09/12 @ 1.2892. Downside Targets = 1.2734 – 1.2648
- TREND REVERSAL to bearish @ 1.2944. TREND REVERSAL to bearish @ 1.2892.
- The December Euro FX dropped lower for the second straight day on Tuesday, reversing the Short Term trend to bearish as both economic and debt worries damper optimism for the Eurozone’s financial success.
- Look for the euro to continue lower on Wednesday and make new 5 week lows as the market targets an extended downside objective of 1.2648.
- Projected Daily Range: .0101
- Projected Weekly Range: .0247
- Projected Monthly Range: .0600
E-Mini S&P (December):
- Short Term Trends are bearish.
- Confirmation of a top with a range violation on 10/09/12 @ 1447.25. Confirmation of a top with a close violation on 10/09/12 @ 1436.00. Downside Targets = 1421.50 – 1417.00
- TREND REVERSAL to bearish @ 1447.25. TREND REVERSAL to bearish @ 1436.00.
- The December S&P’s dropped sharply lower on Tuesday led by the tech sector as the market continued to show signs of weakness when trading above 1450.
- While the S&P’s are long overdue for a modest correction, 5-7% at least, this market has repeatedly found solid support just between 1410 and 1425.
- Note: while the S&P’s had a solid run during all of Q3, analyst are predicting a weak earning season and the IMF issued lower growth rate projections globally which could cause a serious correction to as low as 1334.75.
- Projected Daily Range: 14.50
- Projected Weekly Range: 31.25
- Projected Monthly Range: 74.50
