Friday, March 16, 2012

Oil Update

The above chart of Oil is a weekly chart outlining the entire bull market since 2009. First box outlines a 54 pt upside move. Projecting that into the 2nd outlined box yields an upside target of 121.

Short term ranges as outlined in the next smaller box, marks the breakout move in Oil from October 2011 into the new year of approximately 28 pts. Last outlined box with same 28 pt range projects a price target of 120.

Thus a large part of my projecting of 120-121 in Oil prices going forward before any significant pullback in prices. Going forward 103 level should come in as good near term support for this move.

US Dollar Update

US Dollar apprears to be in a short term breakout pattern which has a current target around the 82.50 level. I believe this breakout should carry the USD to at least the 85-87 level in the near future.

Long term trend remains downward and if strong resistance is found going forward at the 85-87 level I believe a drop proceeding could very well take the USD below the 72 level.

Gold Update: A tale of two scenarios

Gold has been, I guess along with the S+P last year, a little tricky to forecast. Seemingly other outside factors can push this market around more so than others. I try my best to stay on top of this each day, but in saying that I feel you always have to have a "plan B" in case what your initial instincts are telling you, turn out to be incorrect.

I've done exactly that in this case with two scenario's for Gold prices going forward, a scenario A (top chart) is what I feel has the highest probability of playing itself out from a technical aspect, but I imagine from a fundamental aspect also.

I've also added a lesser likely (in my opinion) scenario in case we get a breakdown from the double bottom low around 1535 on Gold (Bottom Chart). If this plays out with a breakdown scenario B will the one in play. Proving once again Technical Analysis is an art and not an exact science.

To the charts; my most likely scenario played out in the top chart has a box range outlined which took Gold to it's all time high above 1900, a trading range has proceeded between roughly 1800 and 1550. I really would like to see a break above 1800 to feel better about the upside targets being hit. In any case Gold should find at least short term support at the levels indicated on this top chart, longs should be looking for anticipation of that breakout and targeting first the big 2000 level which is more psychological than technical, and the main upside objective would end up being a little above 2100.

Scenario B on the weekly chart (bottom chart) forecasts prices going forward on a break below this trading range in Gold. Downside levels would then be very much in play going forward with a maximum downside being around the 1100 level. Bears should be selling around that 1800 level or the top of the range in anticipation of the breakdown of the range, and looking to cover at projected support targets.

TNX (10yr Treasury Yields) Update

The Ten Year Treasury Yields (Ticker Symbol: TNX) are in short term breakout mode with this week's price action easily confirming.

Upside targets are marked on the weekly chart above, as well as downside support going forward.

Tuesday, March 13, 2012

A little more upside...

The end of last week's price action leads me to believe the market in fact still has some more upside remaining in it before any size-able sell off occurs.

The daily chart of the S+P 500 above shows the next projection target to be 1417.58, I now expect the market to hit that target to the upside before at least a 5-10% correction will develop.

Thursday, March 8, 2012

S+P 500 update

Our S+P upside target which was stated in this post click here created over three months ago caught the swing high of this current rally almost to the point, 1.5pts to be exact. And has traded as much as 40 points lower since, now the question remains what happens now?

I believe some further downside price correction is to be expected, I've marked the immediate areas of support and resistance on this daily chart of the S+P 500 cash. The market has retraced into current resistance, it reamins a time to be cautious now and hedged against future downside.

The next wave lower off resistance should carry the S+P below it's last swing low at 1340, into the first support zone on the chart. This zone has confluence and matches the last reaction size we experienced in late November and is about a 5% drop from current highs.

Watch for some price stability there, it's an ideal zone for initiating some long positions targeting above 1400 SP prices.

Be aware however that prices could indeed need to pull back to the support zone below in the 1250-1265 area. This area has multiple confluence zones and matches a 10% pullback from current highs with the last major correction swing in the fall of last year.

I expect this area to be the maximum downside for any such retracement and then a march above 1400, into the 1425-1475 extremely critical price area mentioned in this post click here, should resume.