Crude Spike

By Colin Twiggs
June 10, 2008 4:00 a.m. ET (6:00 p.m. AET)

These extracts from my trading diary are for educational purposes and should not be interpreted as investment or trading advice. Full terms and conditions can be found at Terms of Use.

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Gold

Spot gold formed a megaphone-shaped broadening bottom, similar to the pattern in May. A partial decline (failed swing) would signal a test of resistance at $950, otherwise we will see a test of support at $850.

In the longer term, breakout below $850 would signal a primary down-trend but, considering the weakness of the dollar and the strength of oil, this remains unlikely. Breakout above resistance at $950, on the other hand, would signal a test of $1000. What we are most likely witnessing is a large consolidation similar to 2006. Respect of support at $850 would confirm this.

Source: Netdania

Crude Oil

West Texas Intermediate Crude broke through resistance at $135 before retracing to test the new support level. Failure (reversal below yesterday's low of $133) would warn of another test of support at $122; respect would signal another rally with a target of $135+(135-122)=$148

In the longer term, failure of support at $122 would test $100.

Currencies

The euro encountered short-term resistance at $1.58, retracing to test primary support at $1.53. Respect of $1.55 (60% retracement) would indicate an upward breakout.

In the longer term, failure of support at $1.53 would test $1.43; breakout above $1.60 would offer a target of $1.67; but further consolidation between $1.60 and $1.53 is most likely. Central banks are expected to intervene to prevent further appreciation of the euro above $1.60, while the US economy is expected to weaken, making further depreciation of the euro less likely.

Source: Netdania

The greenback broke out above 106 yen, ending its recent consolidation. Breakout from the trend channel indicates that the down-trend is weakening. Expect a retracement to test the new support level.

Source: Netdania

The Australian dollar is testing support at $0.95. Downward breakout would test short-term support at $0.93, while recovery above $0.95 would test $0.9650. In the longer term, breakout above $0.9650 would test parity; failure of $0.93 is less likely and would warn of a test of $0.90.

Source: Netdania

The Aussie respected support at 99 yen before recovering above the previous high. Expect a retracement to test the new support level at 100. In the long term, expect a rally to test 108; reversal below 99 would test 96 and possibly long-term support at 88.

Source: Netdania

I don't make jokes. I just watch the government
and report the facts.

~ Will Rogers

To understand my approach, please read About The Trading Diary.

	Crude Spike By Colin Twiggs June 10, 2008 4:00 a.m. ET (6:00 p.m. AET) These extracts from my trading diary are for educational purposes and should not be interpreted as investment or trading advice. Full terms and conditions can be found at Terms of Use. If you haven't already done so, please help us to improve our newsletter and charting services by completing this quick one-minute survey. Gold Spot gold formed a megaphone-shaped broadening bottom, similar to the pattern in May. A partial decline (failed swing) would signal a test of resistance at $950, otherwise we will see a test of support at $850. In the longer term, breakout below $850 would signal a primary down-trend but, considering the weakness of the dollar and the strength of oil, this remains unlikely. Breakout above resistance at $950, on the other hand, would signal a test of $1000. What we are most likely witnessing is a large consolidation similar to 2006. Respect of support at $850 would confirm this. Source: Netdania Crude Oil West Texas Intermediate Crude broke through resistance at $135 before retracing to test the new support level. Failure (reversal below yesterday's low of $133) would warn of another test of support at $122; respect would signal another rally with a target of $135+(135-122)=$148 In the longer term, failure of support at $122 would test $100. Currencies The euro encountered short-term resistance at $1.58, retracing to test primary support at $1.53. Respect of $1.55 (60% retracement) would indicate an upward breakout. In the longer term, failure of support at $1.53 would test $1.43; breakout above $1.60 would offer a target of $1.67; but further consolidation between $1.60 and $1.53 is most likely. Central banks are expected to intervene to prevent further appreciation of the euro above $1.60, while the US economy is expected to weaken, making further depreciation of the euro less likely. Source: Netdania The greenback broke out above 106 yen, ending its recent consolidation. Breakout from the trend channel indicates that the down-trend is weakening. Expect a retracement to test the new support level. Source: Netdania The Australian dollar is testing support at $0.95. Downward breakout would test short-term support at $0.93, while recovery above $0.95 would test $0.9650. In the longer term, breakout above $0.9650 would test parity; failure of $0.93 is less likely and would warn of a test of $0.90. Source: Netdania The Aussie respected support at 99 yen before recovering above the previous high. Expect a retracement to test the new support level at 100. In the long term, expect a rally to test 108; reversal below 99 would test 96 and possibly long-term support at 88. Source: Netdania I don't make jokes. I just watch the government and report the facts. ~ Will Rogers To understand my approach, please read About The Trading Diary.	Share: A+ A− Incredible Charts 10.1 Windows software with proprietary trading tools and stock screens. Download 5-Day Free Trial Try it Now! Incredible Charts 11.0 Proprietary trading tools and stock screens now in your browser. Free Trial 30-Day Free Trial Try it Now! Trading Diary Free education, macro outlook and technical updates: Join Now
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