KEY TERMS
OVB Outside Vertical Bar
VRCB Volatility Reduced Compression Bar
Brent Crude Oil (December):
- Short Term Trends are bearish.
- Confirmation of a top with a range violation on 10/31/12 @ 108.50. Confirmation of a bottom with a close violation on 10/26/12 @ 109.55. Downside Targets = 103.71 – 102.07.
- December Brent Crude dropped lower for the third straight day on Wednesday after partially confirming a Short Term top as it made new lows for the week after failing to crack $110 in early trading.
- The current price action suggests that Brent should work its way lower on Thursday and head toward the new Short Term downside targets of $103.71 – $102.07.
- Projected Daily Range: 2.11
- Projected Weekly Range: 4.87
- Projected Monthly Range: 12.02
WTI Crude Oil (December):
- Short Term Trends are bearish.
- Confirmation of a bottom with a range violation on 10/31/12 @ 86.44. Confirmation of a top with a close violation on 10/19/12 @ 90.44. Downside Targets = 86.82 – 85.38
- Possible confirmation of a bottom with a close @ 86.44 or higher.
- December WTI Crude Oil settled just marginally higher on Wednesday as it made new five-session highs but failed to deliver a strong close as it settled below the daily mid-range as trading returned to normal on the NYMEX for the first time this week.
- Traders shouldn’t expect much follow-through on Thursday as a slew of backed up economic reports and EIA storage reports are set to be released that may drive the market lower.
- Projected Daily Range: 2.14
- Projected Weekly Range: 5.16
- Projected Monthly Range: 11.33
Natural Gas (December):
- Short Term trend is bearish.
- Confirmation of a top with a range violation on 10/25/12 @ 3.751. Confirmation of a top with a close violation on 10/26/12 @ 3.724. Downside Targets = 3.661 – 3.577.
- VRCB and inside compression day generated on Wednesday.
- December Natural Gas came within just a penny of the optimal intraday sell price we were looking for on Wednesday before dropping lower throughout much of the session to last trade in the lower 15% of the day’s trading range.
- Look for Wednesday’s bearish price action to be replicated on Thursday as a large storage number should roll out and push the market to new weekly lows where it will battle with bullish hedge funds that support the market at $3.60.
- Projected Daily Range: .134
- Projected Weekly Range: .301
- Projected Monthly Range: .624
METALS
COMEX Gold (December):
- Short Term Trends are bearish.
- Confirmation of a bottom with a range violation on 10/26/12 @ 1719.00. Confirmation of a bottom with a close violation on 10/31/12 @ 1719.10. Upside Targets = 1744.00 – 1775.60.
- Conservative confirmation of a bottom with a close @ 1719.10.
- December Gold moved higher on Wednesday as a return to normal volumes helped drive the market to its highest level in over a week yet closed only just a few ticks above the daily mid-range.
- Gold should continue to build on the predominantly bullish price action it saw Wednesday and challenge not only last week’s high but the previous technical resistance price of $1,744.00.
- Projected Daily Range: 17.60
- Projected Weekly Range: 44.90
- Projected Monthly Range: 95.30
Euro FX (December):
- Short Term Trends are bullish.
- Confirmation of a bottom with a range violation on 10/30/12 @ 1.2963. Confirmation of a bottom with a close violation on 10/30/12 @ 1.2969. Upside Targets = 1.3080 – 1.3108.
- The December Euro FX settled Wednesday’s session virtually unchanged as it was unable to hold the early rally and push through last Thursday’s resistance high to close in the lower 20% of the day’s trading range.
- Look for a rally back to 1.3007 on Thursday before the market is dropped lower once again as it should remain stuck in the recent compressed trading range.
- Projected Daily Range: .0078
- Projected Weekly Range: .0218
- Projected Monthly Range: .0600
E-Mini S&P (December):
- Short Term Trends are bearish.
- Confirmation of a top with a range violation on 10/22/12 @ 1423.25. Confirmation of a top with a close violation on 10/23/12 @ 1416.25. Downside Targets = 1387.00 – 1382.00.
- Possible confirmation of a bottom with a range violation @ 1418.50. Possible confirmation of a bottom with a close violation @ 1418.50 or lower.
- The December S&Ps were like most risk assets on Wednesday, characterized by strong initial movements followed by a weak end to the session as they closed lower on the day with bullish divergent price action.
- Wednesday’s close along with the adjusted ADP employment report noting that a revised September job creation was roughly half of previous estimates should send the market trading mostly lower on Thursday to challenge this week’s low of 1393.
- Projected Daily Range: 15.75
- Projected Weekly Range: 39.75
- Projected Monthly Range: 74.50
