A major bottom is forming in gold and offers a good opportunity to buy at current levels before moving back to record highs, according to Ron William of RW Advisory.
Commodities & Energy
An ominous development is occurring in the DJUBS Commodity Index, according to Walter Zimmermann, Senior Technical Analyst at United-ICAP.
There has been nothing in the recent gasoline futures price action to suggest bottoming action, says Walter Zimmermann, Senior Technical Analyst at United-ICAP, leaving “serious room open to the downside”.
Brent has reached a key target located at 88.49, according to BNP Paribas. A breakout above 90.18 is needed for a short-term bullish reversal, but medium-term they still remain cautious.
Bearish technical developments in many of the key commodity markets emphasise the deflation risks ahead, according to George Davis, Chief FIC Technical Analyst at RBC Capital Markets.
Walter Zimmermann of United-ICAP says that if Brent Crude makes a decisive close below 91, the next target area is 75.80. This, he says, would have nothing to do with crude fundamentals and everything to do with a rising US Dollar.
Gold is approaching crucial support along the bottom of a descending triangle pattern, according to Peter Lee, Chief Technical Strategist at UBS in New York. Violation of this support will open the door to the July 2010 low.
The relationship between USD/JPY and gold is one of the most interesting intermarket stories around, according to George Davis, Chief FIC Technical Analyst at RBC Capital Markets. He points out that this correlation is now at its most negative since 2008.
Further weakness is expected for Brent Crude and Gold, according to BNP Paribas Personal Investors. The next support for Brent is at around 88.5, whereas “below 1290, Gold remains in a bearish stance on all time-frames.”
Despite strong resistance at 1228/29 gold has touched 1235 before reversing again and now needs to hold 1220/19 in the short-term to avoid a continuing decline says Jason Sen at DayTradeSignals. Should this break the metal should target 1215/4 and below this 1212 and 1208.