Gold Rises As Dollar Weakens
By Colin Twiggs
July 15, 2008 1:00 a.m. ET (3:00 p.m. AET)
Spot gold broke through resistance at $950, signaling a test of $1000. Expect a retracement to test the new support level. Reversal below $910 is unlikely — and would warn of a test of primary support at $850.
West Texas Intermediate Crude is consolidating below short-term resistance at $145/barrel. Narrow consolidation would be a bullish sign. Breakout would offer a target of $155 [135+(145-135)], but expect strong resistance at $150. Reversal below $135 is unlikely and would warn of a secondary correction. Primary support remains at $100/barrel.
The euro has made a narrow bullish consolidation after breaking through $1.5850. Expect strong resistance at $1.60 — as well as the possibility of ECB intervention if the euro threatens to rise above this level.
The dollar threatens to fall below 105 yen, which would signal another test of 100 — and possibly primary support at 96. V-shaped bottoms are prone to failure and generally end up as double bottoms or even inverted head and shoulders patterns.
The Australian dollar broke through resistance at $0.9700, signaling a test of parity. Expect retracement to test the new support level in the short-term. Reversal below $0.95 is unlikely at present — and would warn of a test of primary support at $0.90. Breakout below the rising trendline would also warn of a primary trend change.
The Aussie is headed for a test of resistance at 104 yen. Breakout would signal an advance to 108. Reversal below 100 is unlikely — and would test primary support at 88.
People are not disturbed by things,
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