KEY TERMS
OVB Outside Vertical Bar
VRCB Volatility Reduced Compression Bar
Brent Crude Oil (December):
- 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 = 117.15 – 117.88.
- December Brent Crude Oil dropped lower on Friday as a round of profit taking hit the market after once again stalling just below $115.
- Expect Brent to trade lower initially on Monday before rallying back above $114 where it will have to overcome a critical juncture at $114.45 to continue higher near the contract high.
- Projected Daily Range: 2.32
- Projected Weekly Range: 5.34
- 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.
- Inside VRCB generated on Thursday. Possible confirmation of a top with a range violation @ 91.01. Possible confirmation of a top with a close violation @ 91.01 or lower.
- November WTI Crude Oil dropped a shade lower on Friday in a very thin trading range as the market failed to log a sustainable rally throughout the session and settled just below the day’s mid-range.
- Look for WTI to drop lower on Monday in early trading as this move higher should now go back to retest the $90 threshold to try and find support.
- Projected Daily Range: 1.99
- Projected Weekly Range: 5.11
- Projected Monthly Range: 11.33
Natural Gas (November):
- Short Term Trend is bullish.
- Confirmation of a bottom with a range violation on 10/11/12 @ 3.516. Confirmation of a bottom with a close violation on 09/25/12 @ 3.105. Upside Targets = 3.602 – 3.747.
- VRCB generated on Friday making new highs on current move @ 3.638.
- November Natural Gas generated new 2012 highs on Friday as it struggled to continue on the bullish momentum from Thursday bullish storage report, only managing to settle up seven ticks on the day.
- Natural gas has now spent the past two sessions trading within the lower range of IT resistance zone and a drop below Friday’s low could signal a profit taking sell-off that could drop this market from its oversold stature down at least $0.20 cents and possibly more as the overall fundamentals remain slightly bearish.
- Projected Daily Range: .108
- Projected Weekly Range: .349
- 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 = 1749.50 – 1738.00.
- New lows made on current move Friday @ 1753.50. Downside Targets 85% achieved.
- December Gold dropped sharply lower on Friday to log its first double-digit losing week since early July as last week generated a double VRCB combination after the $200/oz. move.
- Gold has more than an 82% probability of violating last week’s low and should continue lower into the current correction as it tracks our downside objectives.
- Projected Daily Range: 17.90
- Projected Weekly Range: 43.80
- 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.
- Possible confirmation of a bottom with a range violation @ 1.3001. Possible confirmation of a bottom with a close violation @ 1.3001 or higher.
- The December Euro FX did indeed move higher on Friday but was unable to close above the 1.30 mark deemed necessary in order for this market to generate a sustainable rally.
- Friday’s weak close indicates that the euro should see bearish price action on Monday and fall back below 1.29.
- Projected Daily Range: .0092
- Projected Weekly Range: .0207
- 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.
- New lows made on current move Friday @ 1420.00.
- The December S&Ps had their largest one week decline in almost four months last week as they settled at their lowest level in five weeks as weak Q3 demand has investors worried about this round of earnings season.
- As mentioned in last week’s report, now that the S&Ps have broken 1420, this market should have no problem trading down to the 1400 level and perhaps further should bulls back off and sellers take hold of this market on earnings weakness.
- Projected Daily Range: 15.00
- Projected Weekly Range: 36.25
- Projected Monthly Range: 74.50
