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We first started out today by discussing the bounce unfolding in precious metals and where it may stall. The short answer is, any time now. Gold prices are trading at a critical area just under 1260, with the highly influential 2011 trend-line once again in play. The general shape of the chart going back a few months suggests we will see a dive lower and the shorter-term outlook, while it’s been bullish, is likely to come to an end very soon if it hasn’t already. Along with gold, silver looks headed lower very soon. We are still targeting the 2003 trend-line under 15.
Crude oil appears to be carving out a corrective scenario, but the path isn’t yet clear. One thing which is clear, 47 matters, and a lot. How price action unfolds in the days ahead could be very telling. Broadly speaking, oil still looks headed for the 30s at some point.
Global indices have been a difficult read, with the major indices not moving in congruent fashion. The S&P 500 sits calmly around record levels, consolidating. While the DAX, on the other hand, looks headed to fill the gap from April and trigger a topping H&S pattern. Euro strength is not being kind to the index. The FTSE 100 is becoming a very difficult read over the near-term, and so on that we’ll focus our attention elsewhere.
Overall, the focus is on lower precious metals and crude oil, while staying away from indices for now.
For full technical considerations, please see the video above…
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---Written by Paul Robinson, Market Analyst
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