U.S. government data showed retail sales unexpectedly fell in March by the most in nine months, and consumer confidence data also underwhelmed investors looking for more positive news to keep the record breaking stock market rally continuing. Today, we are seeing some interesting volatility expansion in a variety of markets.
The JUN13 E-mini S&P 500 futures market is reversing off of its recent high of 1593. Today this market is down 9 points, hitting a low of 1575. This market could potentially head lower next week back towards its key pivot level of 1550, as the market may begin to develop an idea that the equity markets are due for a minor correction.
Several commodities are making big moves today. For one, crude oil is down almost 3% to right below the $91 level. We have the $93 level as key resistance, and we also believe this market could continue to trade much lower into the summer, potentially even breaking below $80. Natural Gas is continuing to have very bullish forces control the market, trading up almost 2% at around $4.22. To us, natural gas is in a significant uptrend, and it might be tough to call an upside target. We believe that as long as this market stays above $4, it is very bullish.
The most interesting move in today’s market is occurring in gold and silver. Possibly fueled by rumors that Cyprus may sell their gold reserves (currently denied by Cyprus), gold and silver market are getting smashed downwards today. May13 gold futures are down $65 to below $1,500. May13 silver is down over 5% to almost $26. We have a longer term target on the gold market at $1,410. We believe gold could hit $1,475 and start to stabilize, but we are still more bearish than bullish at this point. Gold could fall farther.