Today we are going to look at everything except equities. Since there is a lot to cover we are going to jump right into it.
Precious Metals:
Gold (GLD) had a pretty good run at breaking out last week, but the NFP reversal put the move in doubt.
Continuing to go up after 3 weekly high closes is a tough ask and with a down week it is actually healthy and gives buyers an opportunity to get in. The next break should come now and take price through $1,295 for the buy stops and $1,330 to $1335 our next target price.
Silver (SLV) is still very volatile and hard to analyze with any confidence. We think it’s best to just rely on solid set-ups, and there may be one when the trend-line below breaks on the next wave up. If the break comes in the wave of 3 position (we noted above), we know there are very high odds price will keep running up.
Oil (USO)
There are two likely scenarios in the short term.
Bullish: This targets $52.5-53.2 as long as the $47.5 breakout holds.
Bearish: This will flush out late bulls (we are noticing a few) and go sub $45 before the next leg of the rally. When there is this lack of a clear direction we recommend waiting until we see a cleat trend start. We are trading the time frame evidenced above and have long term target north of $60.
Natural Gas (UNG)
Here we had back to the drawing board on natural gas, as the length of time it went sideways in July was far too long to see where it was likely to break out. We have therefore had to label the decline as an ABC correction, currently finishing on wave C.
This won’t (as you might expect) change much in the longer term, or even in the short term, but we are looking for a reversal at the end of wave C. It is interesting to see how the first 5 waves down (look at wave A) are contained in a channel and this channel broke; this is why we first thought that NG had bottomed in June, but unfortunately, we were wrong (it doesn’t happen often but we are only human) about the formation started another wave down for wave C.
We are looking for some sort move higher to confirm we have seen the bottom. At the moment, the last wave looks a bit small so it may still lead the price lower, but shouldn’t get lower than $2.6. We are still looking for a run to $4 and in the longer term, but the best way to play the reversal is probably long dated calls.
Precious Metals:
Gold (GLD) had a pretty good run at breaking out last week, but the NFP reversal put the move in doubt.
Continuing to go up after 3 weekly high closes is a tough ask and with a down week it is actually healthy and gives buyers an opportunity to get in. The next break should come now and take price through $1,295 for the buy stops and $1,330 to $1335 our next target price.
Silver (SLV) is still very volatile and hard to analyze with any confidence. We think it’s best to just rely on solid set-ups, and there may be one when the trend-line below breaks on the next wave up. If the break comes in the wave of 3 position (we noted above), we know there are very high odds price will keep running up.
Oil (USO)
There are two likely scenarios in the short term.
Bullish: This targets $52.5-53.2 as long as the $47.5 breakout holds.
Bearish: This will flush out late bulls (we are noticing a few) and go sub $45 before the next leg of the rally. When there is this lack of a clear direction we recommend waiting until we see a cleat trend start. We are trading the time frame evidenced above and have long term target north of $60.
Natural Gas (UNG)
Here we had back to the drawing board on natural gas, as the length of time it went sideways in July was far too long to see where it was likely to break out. We have therefore had to label the decline as an ABC correction, currently finishing on wave C.
This won’t (as you might expect) change much in the longer term, or even in the short term, but we are looking for a reversal at the end of wave C. It is interesting to see how the first 5 waves down (look at wave A) are contained in a channel and this channel broke; this is why we first thought that NG had bottomed in June, but unfortunately, we were wrong (it doesn’t happen often but we are only human) about the formation started another wave down for wave C.
We are looking for some sort move higher to confirm we have seen the bottom. At the moment, the last wave looks a bit small so it may still lead the price lower, but shouldn’t get lower than $2.6. We are still looking for a run to $4 and in the longer term, but the best way to play the reversal is probably long dated calls.
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