Paul Ebeling Gold, Silver and Crude Oil Report Gold, Silver and Oil Report 5 May 2011
Red's Mid-week Report on Gold, Silver and Crude Oil Charts by Omega Research
5 May 2011 Paul A. Ebeling, Jnr. www.livetradingnews.com
SPDR Gold Trust (ETF), NYSE:GLD, iShares Silver Trust (ETF), NYSE:SLV, United States Oil Fund LP (ETF) The Overall Fundamentals Gold futures on the COMEX Division of the New York Merc closed lower on Wednesday, pressured by the steep fall in the Silver price plus a media indication that 2 high-profile players were selling precious metals. The most active Gold contract for June delivery fell 25.1, or 1.6%, to 1,515.3 oz. A look at the action over the last few weeks says that a lot of commodities including precious metals are overbought, and the market needs to correct in here, and this is a healthy, normal part of any secular Bull Market. Shayne and I view Silver market was very speculative, with light fundamental reasons for such a high price, and perhaps the speculative assets are being taken out of the Silver market for now. Gold on the other hand is in Stronger hands than Silver, as Gold operates now as an International currency, and I believed that any further dip in the Gold price is likely to be met with more buying. Silver IMO has been riding Gold's back and when a market goes parabolic such gains likely will not hold. The USD was off against major currencies in late New York trading Wednesday a a bailout plan in Portugal boosted the Euro, and there are expectations for USD rebound and correction coming, we have to see Silver for July delivery fell 3.197, or 7.5% to 39.388 oz. and July Platinum declined 34.2, or 1. 8%, to 1,826.30 oz. The US Crude Oil price continued to fall Wednesday on more than expected inventories build last week. The US Energy Information Administration reported Wednesday the Crude Oil inventories rose 3.4M bbls in the week ending April 27, almost 2 times analysts' expectation. The American Petroleum Institute's figures Tuesday showed a rise of 3.2M bbls. Supply increase pressured the markets. WTI, the US benchmark Crude Oil fell below 110 bbl for the 1st time in 2 wks. The gasoline stockpile marked the 11th-week straight decline, analysts had expected an increase due to fuel demand declines caused by higher prices.
The disappointing job data also weighed on the oil market. The ADP Employer Services said U.S. private sectors added 179,000 jobs in April, less than economists' previous expectations of 198, 000. WTI Crude Oil for June delivery fell 1.81, or 1.63 to finish at 109.24 bbl on the New York Merc. In London, Brent Light Crude for June delivery fell over 1% +, and closed at 121 bbl.
The Overall Technicals Comex Gold (GC) Gold continues to consolidate below 1577.4, its short term Top, and more corrective trading is likely in here, with risk of deeper fall. Any downside should be contained by 1478/9, cluster support mark, and bring on another rise. A clear break Above 1577.4 will extend the rally to 161.8% projection of 1309.1 to 1445.7 from 1380.7 at 1601.7 next, close to 1600 psych mark. The Big Picture: Gold's long term up-trend is in place. So, I will stay Bullish as long as 1492, the Key support holds, and expect the current up-trend to target 100% projection of 1155.6 to 1432.5 from 1309.1 at 1586. It is very clear that Gold is overbought in here, there is no sign of Topping yet from my POV. A clear break of the resistance and trading above 1600 psych mark leads the way to 161.8% projection at 1757.1. And a bounce off from 1600, the psych mark, will suggest medium term Topping from my POV, and would bring pull back to 1309.1/1432.5, the Key support Zone. Stay tuned...
Comex Silver (SI) Silver's pull back from 49.82, extended further and down to 39.39. While another fall might be seen in here, I expect Strong support at from 61.8% retracement of 33.565 to 49.82 at 39.77 or so to contain the downside and bring on a rebound. On the Upside: a clear break of 49.82, the Key resistance, is needed to confirm that rally's resumption. So for no I will be Neutral on Silver, and look for more corrective trading in here. But, note that sustained trading below 40, the psych mark, puts 33.565, Key support in the headlights. The Big Picture: the long term up-trend in Silver is still on, and this rally is likely to extend through 50, the psych mark, to next long term projection target of 261.8% projection of 4.01, the Y 2001 low to 21.44 the Y 2008 high from 8.4 the Y 2008 low at 54.03. On the Downside: continued trading below the 55 days EMA, now at 38.921, is needed as the 1st signal of a medium term reversal. Barring that my outlook is Bullish on Silver. Stay tuned...
Nymex Crude Oil (CL) Crude Oil's break of 110.71, Key support, suggests that rebound from 105.31 finished at 114.83, ahead of my target of 100% projection of 33.2 to 83.95 from 64.23 at 114.98.
There is a Bearish divergence condition in daily MACD, so 114.83 might be a short term Top and intra-day bias has turned to the Southside for pull back to 105.31, Key support, or further to the 55 days EMA, now at 104.78. On the Upside: a clear break of 114.83 will confirm this rally's resumption, and without it look for another fall even if there is some recovery. The Big Picture: the medium term rebound from 33.2 is in progress, and a Stronger rise may be seen towards 100% projection of 33.2 to 83.95 from 64.23 at 114.98. But, once again there is 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. That said, I will be on the alert for reversal signal again above the 114.98 projection level, and note that a clear break and trading below 96.22, Key support, augurs medium term Topping from my POV. Barring that I am Bullish Crude Oil. Stay tuned...
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Fax: +65 6329 9699 www.ebeling-heffernan.com www.livetradingnews.com www.paul-ebeling.com www.redroadmaster.com Paul A. Ebeling, Jr. writes and publishes The Red Roadmasterâ€™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. Ebeling 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. Paul Ebeling is a CO-Founder of Ebeling Heffernan Asiaâ€™s fastest growing Advisory Firm and is a Senior Dark Pool FX, Equity and Commodity Analyst at Heffernan Capital Management. www.heffcap.com
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