Tag: Nymex Light Crude

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Gold responds to crude strength and Dollar support

The Dollar Index is testing primary support between 92 and 93. Breach of support would offer a long-term target between 83 and 84* — a bullish sign for gold.

Dollar Index

*Target: 93 – ( 103 – 93 ) = 83

Crude continues to test resistance at $50/barrel. Respect would indicate another test of the lower trend channel, around $40/barrel, continuing the primary down-trend. Follow-through above $50 would suggest that a bottom has formed and the next correction is likely to be higher than the last low at $42.

Nymex Light Crude

Gold retraced to test support at $1250/ounce — in line with crude strength and Dollar support. Respect of support is more likely and would indicate another test of $1300. Reversal below $1250 is unlikely but would warn of another test of primary support at $1200.

Spot Gold

Silver also retraced and is likely to test primary support at $15.50. Rising Twiggs Trend Index suggests that another test of resistance at $17 remains likely. Breakout above $17 would be bullish for gold.

Spot Silver

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Gold rallies as Crude rises and Dollar falls

The Dollar Index is testing primary support between 92 and 93; bullish for gold. Breach of support would offer a long-term target between 83 and 84*.

Dollar Index

*Target: 93 – ( 103 – 93 ) = 83

Crude rallied strongly this week, with Nymex light crude testing its upper trend channel at $50/barrel. Respect would indicate another test of the lower trend channel, around $40/barrel, continuing the primary down-trend. Follow-through above $50 would suggest that a bottom has formed and the next correction is unlikely to reach the last low of $42.

Nymex Light Crude

Gold followed through above $1260 after a brief retracement, indicating another test of $1300. Reversal below $1250 is unlikely but would be a bearish sign, warning of another test of primary support.

Spot Gold

The accompanying rally in Silver is testing the descending trendline at $17/ounce. Penetration would suggest that a bottom is forming and the primary down-trend is near an end; a bullish sign for gold.

Spot Silver

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Gold rallies as Dollar plunges

The Dollar Index is in a primary down-trend. Its decline accelerated in the last week, headed for the next level of primary support between 92 and 93, which is bullish for gold.

Dollar Index

Falling crude prices, however, have a bearish influence on gold. Nymex light crude recently staged a rally but ran into resistance at $47.50/barrel. Expect another decline to test the lower trend channel at $42, continuing the primary down-trend.

Nymex Light Crude

Gold broke resistance at $1250/ounce. Follow-through above $1260 would signal another test of resistance at $1300. Reversal below $1250, on the other hand, would be a bearish sign.

Spot Gold

Silver rallied off primary support at $15.50/ounce but only a break above the descending trendline (at $17/ounce) would flag a reversal in the primary down-trend.

Spot Silver

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Gold: There’s life in the old girl yet

The Dollar Index is in a primary down-trend. Breach of support at 95.50 signals another decline. The long-term target is the 2016 low between 92 and 93.

Dollar Index

A weakening Dollar and geo-political uncertainty should fuel demand for gold, but gold and silver have both been testing support in recent weeks rather than advancing strongly as expected.

The best explanation I have for this is falling crude oil prices. The long-term chart below shows gold and crude oil prices adjusted for inflation (CPI). Whenever there is a strong surge in crude oil prices, gold tends to follow. Rising crude prices and higher consequent inflation reduce confidence in the Dollar and major oil producers tend to buy more gold with their newfound surplus, as a store of value.

Gold & Crude Oil prices adjusted for inflation

The opposite occurs if oil prices fall and those same oil producers are forced to sell gold reserves in order to fund an unexpected deficit.

At present crude prices are undergoing a bear market rally, having recovered above resistance at $45/barrel, but the primary trend is down. Gold has followed suit, recovering above support at $1215/ounce. Penetration of the declining trendline suggests a test of resistance at $1250.

Spot Gold

But crude prices remain weak and (gold) respect of $1250 would indicate another test of primary support at $1200.

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Crude breaks support at $45 / New Twiggs Trend Index

Nymex Light Crude retreated below support at $45/barrel, confirming a primary down-trend. Breach of $40 would strengthen the bear signal, offering a target of the 2008/2016 lows between $25 and $30. Declining Twiggs Trend Index, with a peak below zero, warns of a primary down-trend. Follow-through below the last trough at -1.0% would strengthen the warning.

Nymex Light Crude

Twiggs Trend Index is a new proprietary indicator that will be released with the next upgrade of Incredible Charts. The indicator combines Market Sentiment (as in Twiggs Money Flow) over Volatility rather than Volume (in Twiggs Money Flow). Signals are read in a similar way to Twiggs Money Flow but it just gives readers a slightly different perspective on the market while avoiding some of the occasional distortions caused by massive volume spikes that affect Twiggs Money Flow. I will publish more detail in a separate newsletter next week.

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Crude headed for $30 if OPEC fails to deepen cuts

Crude could fall to $30/barrel next year — and stay there for two years — according to Fereidun Fesharaki, chairman of consultants FGE.

Nymex Light Crude breached support at $45/barrel, signaling a primary decline. Expect further support at $40 but penetration of this would target the 2008 low at $30 and the 2016 low at $25 a barrel.

Nymex Light Crude

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Crude falls are likely

Nymex Light Crude broke support at $47/barrel, signaling a down-trend. Follow-through below $45 would confirm.

Nymex Light Crude

Lars Christensen shows that projected oil demand is closely linked to monetary conditions, with a down-turn in oil prices whenever the Fed announces further rate hikes. At present both the PBOC and the Fed are adopting a restrictive stance which should be bearish for crude oil.

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Crude: Another advance likely

Nymex December Light Crude is consolidating above the new support level at $50/barrel. Respect is likely and would confirm the primary up-trend. Target for an advance is $56/barrel*.

December Light Crude

* Target: 50 + ( 50 – 44 ) = 56

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Crude tests key level at $50

December Light Crude is retracing to test new support at $50/barrel after the recent breakout.

December Light Crude

If we look at the longer term weekly chart we can see how important this level is. Respect of $50 would confirm the primary up-trend. There is still doubt that support will hold — and that OPEC will be able to craft an agreement that will satisfy members while restricting supply. Failure would suggest that crude will revert to ranging between $40 and $50.

Nymex Light Crude

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OPEC deal a fake

OPEC announced an agreement to cut production — to between 32.5 million and 33 million barrels per day from current levels of 33.2 million barrels — without agreement as to which members will bear the brunt of the production cuts. FGE Chairman Fereidun Fesharaki calls this “a fake deal” and explains that OPEC could not afford to come away from Algiers empty-handed.

http://video.cnbc.com/gallery/?video=3000555509

Nymex Light Crude rallied to $48/barrel and looks set to test resistance at $50. Breakout above $50 would signal a primary up-trend but respect is more likely, once the market gets past the headlines, and would suggest further consolidation between $40 and $50.

Nymex Light Crude

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