|Preferred Strategy: The S+P made a new high on Tuesday but then reversed to close a little lower, and from the look of the short-term momentum indicators are we may have a little more downside ahead, with a possible test of 2560/70 ahead.
While a test of 2600 should not be ruled out, the longer-term indicators also look a bit toppish, so I am rather wary of being long at these levels, although if US bond yields head lower, then the upside will again prevail. For now, it is possibly best to stand aside and watch the bonds. I think the short term might see the 10 years head lower, towards 2.2%, but longer term I remain of the view that 2.24%will eventually give way, leading towards a move to 2.6% and eventually higher.
As before, I prefer not to be involved at these lofty levels although at this stage there is little sign of a significant turnaround.
|24 Hour: Mildly bearish||Medium Term: Neutral|
|2600||Minor||2575||6 Nov low|
|2595||Minor||2562||2 Nov low|
|2590||Minor||2557||27 Oct low|
|2593||Session high – all-time high||2550||Minor|
|Preferred Strategy: Ditto S+P.|
|24 Hour: Mildly Bullish||Medium Term: Neutral|
|23650||Minor||23288||2 Nov low|
|23600||Minor||23268||31 Oct high|
|23555||Session high – all-time high||23201||25 Oct low|
|Preferred Strategy: Gold remains within the recent range of 1265/85, and with the momentum indicators looking neutral we might expect more of the same today, with direction dependent on the dollar/US yields.
Gold is currently at 1275, right in the middle of the range and sitting right on the 100 DMA, and also holding above the recent low and the 200 DMA. As long as we stay above 1260, then I think we could see another minor squeeze back towards 1280/85 and possibly higher, although more likely it looks set to remain choppy near current levels. If we do see further gains in the dollar, we should then look for a run below the 200 DMA, towards 1250, where the rising trend support will provide decent support, but below which could see a quick move towards 1240.For now I remain neutral but prefer to sell rallies.
|24 Hour: Neutral||Medium Term: Neutral|
|1309||(50% of 1357/1261)||1274||100 DMA|
|1296||17 Oct high||1271||Session low|
|1291||20 Oct high||1266||6 Nov low|
|1284||2 Nov high||1261||6 Oct low/(61.8% of 1205/1358)/200 DMA|
|1282||Session high/6 Nov high||1251||8 Aug low/Rising trend support|
|Preferred Strategy: WTI extended its rally to a new 2 year high of 57.66 today although it gave back a little too finish the session consolidating just above 57.00.
The short-term momentum indicators are looking a little toppish from here, so further consolidation may be in store, but I would be looking to buy dips towards 56.00/55.50, with a SL placed under 54.40.
In the bigger picture Having moved up to 57.66, we are sitting against strong Fibo resistance but a break of which there is little to stop WTI heading to 59.00 which will again be strong. Above here though 60.00 would seem a short step away
Buy WTI @ 56.25. SL @ 54.40, TP @ 59.00
|24 Hour: Possible Topping Formation – Prefer to buy dips||Medium Term: Mildly Bullish|
|58.50||Minor||55.63||6 Nov low|
|58.00||Minor||54.75||(23.6% of 45.56/57.58)|
|57.66||Session high /38.2% of 107.65/26.03||54.38||3 Nov low|