The Overall Fundamentals
Gold rises to new record at 1,801 intra-day, Silver + 3.8% and Crude Oil + 3.59
Gold futures on the COMEX Division of the New York Merc further hiked Wednesday, settling at a new record, spurred up by rising safe-haven demands. The precious Yellow metal Topped the Key psych mark of 1,800 oz during the intra-day trading.
The most active Gold contract for December delivery rose 41.3, or 2.4%, to 1,784.3 oz, the highest closing in history.
Market analysts reported that Global investors continue to monitor the instability in both the United States and European Union.
The Street rumor is that Standard & Poor's is now taking aim at France its the next rating downgrade.
Global stocks Wednesday suffered sharp falls again on concerns that France may be next in losing its triple-A credit ratings. The cost of insuring French debt against default rose as a result.
After S&P cut US credit rating, Gold saw 3 straight rises for a 8% boost, the biggest 3-day rally since November 2008.
Traders noted that the overall problems in the US are far from over and the appetite for safe haven assets like Gold is Strong.
Bank of America Merrill Lynch Tuesday raised its 12- month Gold price forecast to 2,000 oz. there was some profit taking on the forecast but it absorbed and accelerated quickly.
Silver for September delivery rose 1.444, or 3.8%, to 39.327. Platinum for October delivery rose 15.3, or 0.87%, to 1,771.1 oz.
The WTI Crude Oil price bounced from a 10-month low Wednesday as the US Crude Oil inventories declined sharply last week, although concerns about European debt crisis continues to weigh.
Light, Sweet Crude for September delivery 3.59, or 4.53% to finish at 82.89 bbl on the New York Merc. In London, Brent Crude for September delivery also rebounded and last traded around 107 bbl.
The Overall Technicals
Comex Gold (GC)
Intra day bias in Gold is to the Northside with 1718.2, the minor support, intact. This rise should extend further to 1800, the psych mark, first and it did Wednesday. This rally shows signs of acceleration and targets 161.8% projection of 1309.1 to 1577.4 from 1478.3 at 1912.4 next.
On the Downside: a clear break below 1718.2, the minor support, will turn the bias Neutral, and bring consolidations first, but any retreat should be contained by 4H 55 EMA, now at 1682.8, and bring on a rally resumption.
The Big Picture: Gold's up-trend from Y 2009 low of 681 is in progress and met 161.8% projection of 1155.6 to 1432.5 from 1309.1 at 1757.1 already.
Note: the up-trend is showing signs of acceleration by taking out the medium term and long term channel resistance. The weekly MACD has already broken out of its long term range, and sustained trading above 1757.1 will drive Gold through 2000, the next psych mark, to 261.8% projection at 2034.
On the Downside: a clear break of 1.5774, the resistance turned support, is needed to be the 1st signal of medium term Topping IMO. Barring that I am Bullish gold, even in case of steep pull back. Stay tuned...
Comex Silver ( SI )
The break of 37.555, the temporary low, indicates that fall from 42.2945 has resumed. As noted several times I favor the case that entire rebound from 32.30 finished at 42.295.
Intra-day bias came back to the Southside for a test of the 32.30/33.38 support Zone.
On the Upside: a clear break above 40.40, the minor resistance, will dampen this immediate Bearish POV and turn bias Neutral .
The Big Picture: Silver's price actions from 49.82 are treated as consolidations in the long term up-trend. The 1st leg from 49.82 should have completed at 32.30. Rise from 32.30 is treated as the 2nd leg and may have finished at 42.295. Sustained trading below the 55 wks EMA now at 37.97 should then send Silver through 32.30 support to 61.8% retracement of 14.65 to 49.82 at 28.085.
On the Upside: a clear break above 42.295 will delay this Bearish POV and bring another rise towards 49.82 high 1st. Stay tuned...
Nymex Crude Oil (CL)
With 4H MACD above signal line, a temporary low is formed at 75.71, just ahead of 100% projection of 114.83 to 89.61 from 100.62 at 75.40.
Intra-day bias has turned Neutral, and some consolidations should be seen in here. Any Northside of recovery should be limited by 89.61, support turned resistance, and bring fall resumption. A clear break of 75.71 will target 70, the psych mark, next.
The Big Picture, as noted before, the medium term rebound from 33.2 is treated as the 2nd leg of consolidation pattern from 147.24. A sustained break of 83.85, the cluster support, indicates that the rally finished at 114.83 and the 3rd leg of the consolidation should have started. The current fall from 114.83 should now target next Key cluster support at 64.23; 61.8% retracement of 33.2 to 114.83 at 64.38. A clear break there targets a retest of the 33.2 low.
On the Upside: a clear break of 89.61, Key resistance, is needed to be the 1st signal of bottoming, so barring that I am Bearish Crude Oil. Stay tuned...
Paul A. Ebeling, Jnr. 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, Jnr 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.