Gold, Silver and Oil Trading Outlook

By Paul A. Ebeling, Jnr.,

Shutterstock photo

SPDR Gold Trust ( ETF ), NYSE:GLD, iShares Silver Trust ( ETF ), NYSE:SLV, United States Oil Fund LP ( ETF ) NYSE:USO

Red's Weekly Report on Gold, Silver and Crude Oil

Charts by Omega Research

24 April 2011

Paul A. Ebeling, Jnr.

The Overall Fundamentals

Gold extended above 1500 with the benchmark Comex contract rising to a new record high of 1509.5.

Silver rose for a 3rd day running as the price went above 46 for the 1st time in 31 yrs.

Crude Oil prices strengthened as the front-month contract for WTI Crude Oil rose to112.48 before pulling back to 112.10.

The corresponding contract for Brent Crude Oil rose a bit higher but struggled to test the 125.00 mark.

Players largely ignore IEA's comment that 'high Oil prices have already caused slowing demand in countries like China and the US'.

At an interview, IEA's Director Tanaka said high Crude Oil prices have dampened growth. There is a '6-month lag for the World economy to fully show the impact of high Crude Oil prices. But if they stay at current levels, the consequences will be bad'.

Growth in Chinese Crude Oil demand has slowed in part as the result of monetary tightening,

Meanwhile, Mr. Tanaka said the OPEC would need to raise output in June or July as European refineries returned after maintenance and as reconstruction works in Japan begin.

Nat Gas demand will also accelerate as radiation leak in Japan has suspended many nuclear projects across the globe.

The IEA believes the Nat Gas demand could be much, much tighter in the future as governments will increase the use of gas for power generation. The current glut in Nat Gas supplies will evaporate very soon IMO.

The Overall Technicals

Comex Gold (GC)

Gold's rally is in progress and tapped a new record high of 1509.5. Intra-day bias remains on the Northside for 100% projection of 1309.1 to 1445.7 from 1380.7 at 1517.3 next.

On the Downside: a clear break below 1488.2, Key support, will indicate to me a short term Topping and bring on a retreat. Barring that my outlook is Bullish even in case of pullback.

The Big Picture: Gold's long term up-trend is progressing, and is regaining momentum. That being the case I will stay Bullish as long as 1380.7, the Key support, holds. Further acceleration from 1500, the psych mark, will point to 100% projection of 1155.6 to 1432.5 from 1309.1 at 1586 next. Stay tuned...

Comex Silver ( SI )

Silver rose to 46.07 Thursday and so far and intra-day bias remains on the Northside for 161.8% projection of 17.735 to 31.275 from 26.30 at 48.208 next.

On the Downside: a clear break below 44.21, the minor support, will indicate that a temporary Top is formed, and bring on consolidation before staging another rally.

The Big Picture: the long term up-trend in Silver is in progress, and is regaining momentum. The target is 50, the psych mark. But, a break of 36.74, Key support, is needed to be the 1st signal of medium term topping. Barring that, my medium term outlook is Bullish. Stay tuned...

Nymex Crude Oil ( CL )

Crude Oil's break of 110.24, the Key resistance, suggests that the pull back from 113.46 finished at 105.31.

Intra-day bias turned back to the Northside for a test on 113.46 1st. A clear break will there confirms the rally resumption for 100% projection of 33.2 to 83.95 from 64.23 at 114.98.

On the Downside: a clear break below 4 hrs 55 EMA, now at 108.87 will delay the Bullish case, and bring on more consolidations below 113.46 1st before resuming the larger rally.

The Big Picture: the medium term rebound from 33.2 is in progress, and a Stronger rise should be seen towards 100% projection of 33.2 to 83.95 from 64.23 at 114.98 next. But, here is no change in my POV that this rally is the 2nd wave of the consolidation pattern from that started at 147.27, the Y 2008 high. So, I will look for reversal signal again above 114.98, the projection mark. Remember, a clear break of 96.22, the Key support, is needed to indicate medium term Topping. Barring that my outlook is Bullish.

Paul A. Ebeling, Jr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.

Paul A. Ebeling, Jr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Commodities
Referenced Stocks: CL , ETF , SI

More from International Business Times


International Business Times

International Business Times

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by