Monday, April 15, 2013


Gold: Crashing down
Weekly close: $1,478.35

Gold is forming a wave extension on the downside. It has been falling since the last few months but the angle of decline was not a sharp one. However, as the yellow metal has broken the support zone consisting of multiple intermediate bottoms, it has gathered huge momentum on the way down. Thus, a reversal for the bearish view can now be trailed above that, ie at $1,527. The initial target on the downside remains at the lower end of the medium-term falling channel, ie $1,405. If the bears manage to breach that trendline, then they can target the long-term rising trendline, ie $1,340.

Trend :     Trend Reversal     Supports            Resistances      Target
Down :      $1,527.0                  $1,450/1,400      $1,500/1,521       $1,405/$1,340

Silver: Smashed down
Weekly close: $25.850

For several weeks, silver was trading in a narrow range and had formed a bearish triangular pattern. Silver broke down from the bearish triangle and has resumed with the overall downtrend. On the downside, the white metal has cracked through multiple previous lows and has even extended below the short-term equality target. The subsequent targets on the downside are the lower end of the short-term falling channel ($23.25) and the medium-term equality target ($21.00). The reversal can be tightened to $26.20.

Trend :     Trend Reversal     Supports                    Resistances      Target
Down :      $26.20                     $24.00/22.50              $25.00/26.04       $23.25/$21.00

Copper (Comex): Standing on a diving board
Weekly close: $3.3500

Copper formed a large triangle where the last leg made a throw over of the pattern. The triangle has been formed in the right shoulder of a larger Head & Shoulders pattern. Thus, the red metal seems to be in for a significant decline. The weekly momentum indicator is in a bearish mode.
Copper has broken the lower end of the triangular pattern and has reached the neckline. From a medium-term perspective, copper can target the previous low of $2.994 and the equality target, ie $2.58. On the flip side, the swing high of $3.576 will act as a strong resistance.

Trend :     Trend Reversal      Supports                      Resistances                 Target
Down :        $3.576                       $3.23/3.00                     $3.45/3.55                      $2.994/$2.58

Crude oil: Flowing southward
Weekly close: $91.29

Crude oil has been oscillating about its crucial weekly moving averages. The oscillations have taken place in between two converging trendlines. In terms of the price pattern, the oil has formed a large distribution triangle. From the upper end of the pattern, the oil has started next leg down. Last week’s high of $94.83 will act as a strong hurdle on the upside. The weekly momentum indicator has given a fresh sell signal. Overall, the oil is expected to fall towards $84.00-$77.28.

Trend :     Trend Reversal      Supports                      Resistances                 Target
Down :      $94.83                      $86.20/80.00                $92.55/94.00                  $84/$77.28