Crude Oil Price Update – New Minor Bottom Formed at $50.10, Nearest Upside Target $54.79

U.S. West Texas Intermediate crude oil futures are inching higher into the close, recovering from early session weakness. Traders are now awaiting the release of the American Petroleum Institute’s weekly inventories report.

Earlier in the session, prices were under pressure after a report showed record Saudi production, however, the market turned around as investors expressed optimism over a possible production cut deal at OPEC’s December 6 meeting in Vienna. Short-sellers also trimmed positions ahead of this weekend’s G20 summit on speculation the U.S and China may make progress on trade issues.

At 2125 GMT, January WTI crude oil futures are trading $51.89, up $0.26 or +0.50%.

WTI Crude Oil
Daily January WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $50.10 will signal a resumption of the downtrend. It is currently straddling former bottoms at $51.17 and $50.16. If $50.10 fails, then $49.85 becomes the next target. This is a potential trigger point for an acceleration into $47.96.

The minor trend is also down, but the market did form a new minor bottom at $50.10. This is the first minor bottom since November 12.

The nearest upside resistance is a Fibonacci level at $54.79.

Daily Swing Chart Technical Forecast

Based on Tuesday’s price action, the direction into the close is likely to be determined by trader reaction to the former bottom at $51.17.

Bullish Scenario

A sustained move over $51.17 will indicate the presence of buyers. If this move generates enough upside momentum, we could see a surge into $54.79 over the near-term.

Bearish Scenario

A sustained move under $51.17 will signal the presence of sellers. The main targets are a price cluster at $50.16, $50.10 and $49.85.

The September 11, 2017 main bottom at $49.85 is the trigger point for a steep plunge with the August 16, 2017 main bottom at $47.96 the next major target.

Silver Price Forecast – Silver markets continue to slop

Silver markets tried to rally initially during the trading session on Tuesday but continues to find sellers. I think at this point as the US dollar strengthens, it will continue to work against precious metals overall, and of course silver seems to be especially sensitive in comparison to gold and platinum. I think at this point, the $14 level underneath will be a crucial level, and I think it is a significant support region. If we can break down below there, and it does look like we probably will eventually, then I think the market goes looking towards the $13 level, followed by the $12 level which is even more important.

SILVER Video 28.11.18

At this point, I think every time we rally it will be a nice selling opportunity and I think that till traders will continue to look at this market. The 50 day EMA is starting to slope lower at the $14.50 region, so I think longer-term traders are looking to put money to work as well. If we can break above that EMA, then it’s likely that we go to the $15 level next, which is massive resistance. If we can clear that level, then we can start to see a move much higher, perhaps towards the $17 level. I think at this point we would need to see the US dollar softened significantly before that were to happen, and quite frankly I just don’t see that happening from a longer-term standpoint anytime soon. Silver continues to look threatened.

Crude Oil Price Forecast – crude oil continues to look for a bottom

WTI Crude Oil

The WTI Crude Oil market initially pulled back during trading on Tuesday, but saw buyers come in and pick up the market just above the $50 handle. That of course is a large come around, psychologically significant figure and an area that has been important in the past. Ultimately, I think we will continue to see a lot of volatility in this area, and I do feel that it’s only a matter time before production cuts will become a reality out of places like Saudi Arabia and Russia, but right now it hasn’t happened. At the very least, we should see some type of value hunting. However, if we broke down below the $50 level, then the market could break down to the $47.50 level.

Oil Forecast Video 28.11.18

Brent

Brent markets of course reacted the same, finding support underneath the $60 handle to turn around and show signs of life again. I think at this point, the $64 level would be a significant target, as there is a major red candle from Friday that may have been a bit of a washout, but I think that pullbacks are still going to be a major concern. I think at this point, short-term pullbacks offer buying opportunities but if we do break down to a fresh, new low, then we should go to the $55 level. I think that there will be plenty of longer-term opportunities coming into play, but you would need to have a large bank roll to handle the futures market, but perhaps a small CFD position that you build upon if things rally could be an interesting play at this point.

Natural Gas Price Forecast – natural Gas slides on Tuesday

Natural gas markets continue to be very volatile as we have a lot of different headwinds out there that could cause this commodity to be even more volatile in the short term. The market seems to be treading water above the $4.00 level after the massive surge higher, as the winter months of course will drive up the demand for natural gas in the United States. Historically low inventory numbers have also pushed this commodity higher, but at this point it’s likely that we will eventually get plenty of supply enter the market at these elevated prices. Remember, it’s not that natural gas is hard-to-find or that it is an abundant, it’s just that it had gotten so cheap that people stopped drilling.

NATGAS Video 28.11.18

This led to a bit of a perfect storm, but I think by the time we get through the seasonably bullish time of year, the markets will start to roll over again. In the short term, I do believe that the $4.00 level should offer support, but if we did break down below there we will probably go down to the $3.75 level. Beyond that, we could drop down to the $3.50 level as well. I think we could probably get a bit of a bounce from here though, but I would be looking to fade rallies as we are at historically high prices, and quite frankly I believe that the $5.00 level above was probably the high that we will see this winter. I think suppliers are more than willing to jump into the market and start selling every time we rally.

Gold Price Forecast – Gold markets continue to drag

Gold markets initially tried to rally during the trading session on Tuesday but ran into a buzz saw of resistance at the $1225 level. This market continues to be very noisy based upon the US dollar, and of course fears of global growth. If global growth slows down, that tends to have people running towards the greenback, which in turn works against the value of the metal markets. The market does have the 50 day EMA slicing right through the candle, but now that we have broken through there, it makes sense that the markets would be a bit hesitant here, but it certainly looks as if we are trying to break over and we may have formed a “lower high.”

Gold Outlook Video 28.11.18

Below, I see a major uptrend line, and of course the $1200 level will have a certain amount of psychological importance as well. With that, I am a seller of this market and I do believe that eventually we could break down below the $1200 handle, which would break through to significantly important levels that should offer a bit of interest. If we clear through that area, then we could open up the door as low as $1000 longer term, which was a major area of importance in the past, and of course should attract a lot of attention due to the fact that it is a major figure. The alternate scenario is to buy this market but I don’t feel that we should until we break above the $1250 level.

Gold Price Futures (GC) Technical Analysis – November 27, 2018 Forecast

Gold is trading higher on Tuesday, shortly after the regular session opening. The market is once again mirroring the price action in the U.S. Dollar. The catalysts behind the price action are comments from President Trump regarding additional tariffs on China and ECB President Draghi’s negative comments on the Euro Zone economy on Monday. Both comments helped the dollar strengthen, which put pressure on gold earlier today.

At 1330 GMT, February Comex Gold is trading $1229.80, up $1.10 or +0.09%.

Gold is also being supported by dovish comments from Fed Vice Chairman Richard Clarida. Just a short while ago he said in a speech that the central bank should take a “gradual” approach to rate hikes that should also be “data dependent.”  He also said the Fed is “much closer” to a neutral rate of interest that it was when it started hiking in December 2015.

Comex Gold
Daily February Comex Gold

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, the momentum is trending lower. A trade through $1252.00 will signal a resumption of the uptrend. The main trend will change to down on a move through $1202.40.

The minor trend is down. This is why the momentum is trending lower. It will change to up on a trade through $1236.70.

The main range is $1190.00 to $1252.00. Its retracement zone at $1221.00 to $1213.70 is support. Inside this zone is the short-term retracement zone at $1219.60 to $1215.50. This formation has created potential support clusters at $1221.00 to $1219.60 and $1215.50 to $1213.70.

The intermediate range is $1252.00 to $1202.40. Its retracement zone at $1227.20 to $1233.10 is resistance. The market has been trading inside this zone for seven sessions.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the February Comex Gold futures contract the rest of the session is likely to be determined by trader reaction to the 50% level at $1227.20.

Bullish Scenario

A sustained move over $1227.20 will indicate the presence of buyers. If this move generates enough upside momentum then look for the rally to extend into the Fibonacci level at $1233.10. This is followed by the minor top at $1236.70. This price is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under $1227.20 will signal the presence of sellers. Taking out today’s intraday low at $1225.80 will indicate the selling is getting stronger. This could lead to a collapse into the first support cluster at $1221.00 to $1219.60.

Gold is trading like a secondary market at this time. It’s getting its direction from the U.S. Dollar.

Price of Gold Fundamental Daily Forecast – FOMC Speakers Likely to Drive Price Action

Gold is inching higher on Tuesday after early session weakness. The price action is being manipulated by the movement in the U.S. Dollar Index. This time, the dollar isn’t strengthening because of safe-haven buying or the threat of additional rate hikes by the Fed. It’s the weaker Euro that is driving the dollar higher.

At 1137 GMT, December Comex gold is trading $1223.60, up $1.20 or +0.10%.

On Monday, the Euro rallied early in the session as traders expressed optimism in the new Brexit deal, and reports that Italy was willing to compromise with the European Union over its budget issues. But these gains were taken away after European Central Bank President Mario Draghi acknowledged slowing growth in the Euro Zone.

The Draghi news drove the Euro lower and the dollar index higher, putting pressure on dollar-denominated gold.

Gold was also pressured by comments from President Trump, who told the Wall Street Journal that he expects to move ahead with raising tariffs on $200 billion in Chinese imports to 25 percent from the current 10 percent, and repeated his threat to slap tariffs on all remaining imports from China.

Trump’s comments surprised gold investors because recent speculation showed investors were betting on a possible deal when Trump meets with Chinese President Xi Jinping at the G20 summit in Argentina later this week.

Forecast

The weakness in the Euro continued to pressure gold prices earlier today, but its influence was dampened by concerns over today’s U.S. economic reports and Fed speeches.

The Home Price Index (HPI) is important given the impact of rising interest rates. It is expected to have risen by 0.4%. The S&P/CS Composite-20 HPI is expected to have fallen from 5.5% to 5.3%. Conference Board Consumer Confidence is expected to have dropped from 137.9 to 136.2.

FOMC Members Clarida and Bostic are also expected to speak. Two weeks ago, both Fed officials drove the U.S. Dollar lower with comments about the Fed reaching neutrality.

Gold prices may catch a bid today if Clarida and Bostic continue with their somewhat dovish commentary, but gains are likely to be limited by concerns over Wednesday’s Preliminary GDP report and Fed Chair Powell’s speech. On Thursday, the Fed will release its meeting minutes. Traders are hoping the minutes reveal clues about the pace of future Fed rate hikes.

Clearly, gold needs the dollar to weaken in order to get out of its current trading range.

Natural Gas Price Fundamental Daily Forecast – Mid-December Warming Making Bulls Nervous

Natural gas futures are trading lower on Tuesday but inside yesterday’s trading range. The price action suggests investor indecision and impending volatility. The market seems to have fully-priced in current weather conditions and is now looking out 10-14 days for the next system to develop.

Traders know it gets cold in the winter so they aren’t going to react to every report calling for frigid temperatures. Because of the storage deficit, traders are leaning to the bullish side, but they aren’t going to bite on adding to current long positions unless there is a forecast for a long, lingering cold snap of below normal temperatures. At this time, the forecasts are calling for average to above average temperatures in most of the country so we don’t expect a runaway rally.

Furthermore, traders are still trying to absorb the impact of the huge spike in prices on November 14. Several hedge funds and pensions suffered losses that day and seem a little reluctant to enter the market in a big way at this time. They also seem to be content withhold prices in a range until the next major bullish weather system develops.

At 1051 GMT, January Natural Gas is trading $4.191, down $0.108 or -2.54%.

Forecast

NatGasWeather updated their forecast and the bulls aren’t going to like it. It basically indicates a milder pattern developing for mid-December.

According to NatGasWeather for November 27 to December 3, “A strong weather system with mostly snow will exit the Northeast today, but with very cold temperatures left behind where lows will reach the -0s to 20s across the northern and east-central US, with 20s and 30s over Texas, and the South-Southeast this morning.”

“Warm high pressure will strengthen across the central and southern US the next few days, then expanding across the East this weekend, with highs warming into the 50s to 70s for light demand.”

“The West will see rain into the coast and spreading inland w/additional systems to follow.”

“Overall, nat gas demand will be high to very high through Thursday, then easing to moderate.”

Technically, the main range is $3.199 to $4.964. Its 50% to 61.8% retracement zone at $4.082 to $3.873 is the primary downside target. This zone is controlling the near-term direction of the market.

The short-term range is $4.964 to $3.898. Its retracement zone at $4.431 to $4.557 is the new resistance.

Currently, the market is straddling the upper or 50% level of the main retracement zone at $4.082. Treat this price like a pivot today.

I’ll maintain a bullish outlook on a sustained move over $4.082 but will start getting a little nervous if $3.873 is tested.

 

Oil Price Fundamental Daily Forecast – Short-Term Focus Shifts to Today’s API Inventories Report

U.S. West Texas Intermediate and international-benchmark crude oil futures are trading sideways-to-low early Tuesday as investors continue to gather as much information they can about possible production cuts ahead of the OPEC meeting in Vienna on December 9. Today’s weaker price action is being influenced by fresh news of higher production from Saudi Arabia. Traders are also expressing caution head of the G20 summit in Argentina this weekend.

At 1001 GMT, January WTI crude oil is trading $51.29, down $0.34 or -0.66% and January Brent crude oil is at $50.35, down $0.13 or -0.21%.

According to an industry source, Saudi Arabia raised oil production to an all-time high in November, pumping 11.1 million to 11.3 million barrels per day (bpd) during the month.

Forecast

Prices are likely to trade sideways-to-lower today unless there is unexpected news about supply. Mostly weighing on the market will be the usual slew of issues including weak equities, geopolitics, worries about softening demand and increasing supply.

Short-term, traders are preparing for the latest news regarding supply from the American Petroleum Institute late Tuesday and Wednesday’s inventories report from the U.S. Energy Information Administration. Both reports are expected to show another build. Last week, the API report posted a drawdown, while the EIA reported a build.

Throughout the week, investors will debate the outcome of the G20 summit on November 30 to December 1 and the upcoming meeting between the United States and China. Officials from Washington and Beijing will discuss the escalating trade dispute between the two economic powerhouses. The price action suggests the markets aren’t expecting any major news.

Traders are also focusing on the OPEC meeting in Vienna on December 6. For weeks, investors have been debating whether the cartel and its allies would cut production starting next year. The numbers being tossed around are output cuts of between 1 million barrels per day and 1.4 million barrels per day.

One issue that will have to be overcome is the pressure from President Trump to keep production high. The key to stabilizing prices and maybe even fueling a short-covering rally is for the OPEC-led group to work around Trump’s pressure and do what’s best for the group.

Prices are poised to fall further if OPEC and Russia can’t send a decisive, firm message that they are unified in controlling supply and stabilizing prices.

What Can Stop Crude Oil’s Decline?

In just a week, oil fell by 12%. Since its peak level in October, oil has lost almost a third of its value. This decline has not remained unnoticed in the global markets, as S&P 500 closed last week at lows seen back in May.

Although cheaper crude oil may spur economic growth, its abrupt collapse has caused a chain reaction dragging down other risky assets, such as the shares of the energy sector and major stock indices. Such a situation was also evident back in 2014. The sharp oil collapse was a result of various driving forces acting simultaneously including the growth production, the slowdown of consumption growth and the tightening of еру U.S. monetary policy. The latter had jumpstarted the decline in oil in October.

The market has previously been considered overheated, but the Fed’s stance in support of raising the rate above the neutral level has shifted all attention to the imbalance of supply and demand. This decrease was thereafter accelerated at the time when Iran’s decline in production was not as strong as feared, and those wishing to get Iran’s market shares were lined up in a long line.

During this morning, oil has continued its negative momentum with WTI oil prices dropped 0.91% and Brent oil declined 0.74%. However, at the moment there were no driving forces that allow oil to turn to back to growth, as seen in 2016:

  • Some of the largest producers are still struggling for market share by increasing their supply;
  • Key regions of consumption – Europe, USA, Asia – are slowing down their growth rate;
  • Central banks are not in a hurry to abandon plans for tightening policies.

Although Jerome Powell highlighted the opportunity to pause the tightening policy that weakened the dollar and reduced the yields of U.S. debt, such measures are unlikely to be enough to lift crude prices and it may thus plummet to the bottom again. Let me remind you, in 2016, only the promise to cut off excessive supply from OPEC and Russia has stabilized the market. Parallelly, the Fed, the ECB and the Bank of Japan took a softer stance in the monetary policy, while Asian countries enjoyed increased growth. These factors have driven Crude Oil to growth. But by now, we don’t have any.

This article was written by FxPro

Precious Metals Trade Near Flat With Bearing Bias Over Escalation of Sino-U.S. Trade War Woes

Gold prices inched lower on Tuesday as the dollar steadied amid fears of a slowdown in global economic growth and increasing pessimism due to a worsening of U.S-China trade dispute ahead of the G20 meet. Precious metals market is on dovish price action today as investors await clues on the pace of future U.S. interest rate hikes from the speech of Key figures in US Fed scheduled to occur later today and tomorrow.

Fed’s Vice Chair Clarida will be out on the wires at 13:30 GMT later today followed by speech from other bigwigs like Bostic, Evans and George and there is a speech by Fed Chair Powell tomorrow from which investors expect forward guidance as Fed previously promised three rate hikes in 2019 while analysts and investors have only priced in two rate hikes so far owing to slowdown in global economy.

Investors Await Fed Forward Guidance As Outcome Will have Great Impact on USD Long-Term Outlook

Meanwhile, US greenback has seen increasing demand over escalating Sino-U.S trade tensions owing to latest comments from US President Donald Trump who told wall street journal that he plans to raise the tariff on Chinese goods from 10% to 25% for products worth over $200 billion. Investors continue to believe that the latest bout of dollar resilience at this juncture is borne out of market nervousness and not from any renewed Fed hawkishness which is what makes the speech from US Fed so important as this would also greatly affect price action of dollar-denominated metals and appeal for safe haven instruments on whole.

As of writing this article, Spot Gold XAUUSD is currently trading at $1220.74 an ounce down by 0.13% on the day while US Gold futures GCcv1 are trading at $1222.60 an ounce up by 0.01% on the day.

Meanwhile, Spot Silver XAGUSD is trading at $14.22 an ounce down by 0.04% on the day. Oil settled higher Monday, with U.S. prices posting their biggest one-day rise in eight weeks—just after suffering their worst session percentage loss in three years.

Talk of a meeting of Russian and Saudi oil members this week was driving speculation of an early agreement to cut production, ahead of the much-anticipated Dec. 6 meeting of the Organization of the Petroleum Exporting Countries. Leaders from Saudi Arabia and Russia are scheduled to attend the Group of 20 gathering in Argentina later this week and presence of these two bigwigs in an event which also sees the attendance of US President Trump reinforces the impression that the market could possibly see a high impact headline regarding oil production/supply cut decisions before OPEC summit. Spot Crude WITUSD is currently trading at $51.13 per barrel down by 0.60% on the day.

Natural Gas Price Prediction – Prices Drop but Bounce Near Support

Natural gas prices moved lower on Monday following a long holiday weekend. The drop comes despite colder than normal weather that is forecast to cover most of the United States for the next 6-10 and 8-14 days.  There were stormy weather conditions in the mid-west dropping nearly 10-inches of snow in Chicago and Minnesota. Once snow is on the ground the weather tends to remain colder as the ground freezes.

Technical Analysis

Natural gas prices tested the $4 per mmbtu handle and bounced, rising into the close. Short term resistance is seen near the 10-day moving average at 4.32. Support is seen near the former breakout level at 3.66. Positive momentum is decelerating as the MACD (moving average convergence divergence) index is poised to generate a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average, crosses below the MACD signal line (the 9-day moving average of the MACD line. The MACD histogram is printing in the black with a declining trajectory which points to declining prices.

Last weeks withdrawals were much larger than expected, as colder than normal weather hovered over the mid-west and the east coast.  This week, inventories are expected to decline by 43 Bcf according to Estimize. This compare to a robust drop last week. According to the EIA working gas in storage was 3,113 Bcf as of Friday, November 16, 2018. This represents a net decrease of 134 Bcf from the previous week. Stocks were 620 Bcf less than last year at this time and 710 Bcf below the five-year average of 3,823 Bcf. At 3,113 Bcf, total working gas is below the five-year historical range. The trajectory of inventories are down and demand is likely to remain robust especially with record exports of LNG leaving the United States.  Prices are not high enough for demand destruction leaving more room to rise.

Gold Price Prediction – Gold Trades Sideways as Germany Begins to Slow

Gold prices traded sideways edging slightly lower following the long Holiday weekend in the US.  The dollar gain traction against the Euro following a softer than expected German IFO report that weighed on the EUR/USD.  Yields in the US have been under pressure allowing the dollar to ease last week, but yields in Europe are now falling faster, which is generating headwinds for the yellow metal.

Technical Analysis

Gold prices edged higher on Monday, touching resistance near a downward sloping trend line that comes in near 1,227. Short term support on gold is seen near the 20-day moving average at 1,220. Additional support is first seen near the 50-day moving average at 1,213 and then an upward sloping trend line that connects the lows in August to the lows in October and comes in near 1,208. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. This forecast accelerating negative momentum. Momentum as reflected by the MACD (moving average convergence divergence) index is neutral. The MACD histogram is printing in the black with a flat trajectory which reflects consolidation.  The relative strength index (RSI) which is a momentum oscillator that measures accelerating and decelerating momentum, is printing a reading of 52, which is in the middle of the neutral range and reflects consolidation.

Business in Germany is Decelerating

German business appears to be decelerating and the declines seen in the purchasing manager’s indices, released last week were confirmed by the IFO. The IFO Business Climate Index fell to 102.0 points in November from 102.9 points in October, marking its third consecutive decrease. The IFO’s sub-measurement of uncertainty among business had risen at its fastest level in 10 years, reflecting current concerns over geopolitics. With Germany feeling the slowdown it only a matter of time before the entire continent experiences a decline in economic growth which will weigh on the Euro and generated headwinds for gold.

Silver Price Forecast – Silver markets fail to hang onto early gains

Silver markets tried to rally to kick off the session on Monday but gave up the gains as we approach the $14.50 level. This is essentially fair value in the overall consolidation area that I have marked on the chart between the $14 level on the bottom and the $15 level on the top. Beyond that, we also have the 50 day EMA at that level as well, and it is starting to slope lower again. If that’s the case, then I think the sellers are going to start to get a little bit more aggressive.

SILVER Video 27.11.18

Selling rallies in the silver market should continue to work, at least until we break above the $15 handle. The markets do favor the downside overall and when you look at the longer-term charts, there is a 20 year trend line that was recently broke down. Because of this, I think that we have a very strong bearish sentiment in this market still, even though I like the Silver markets longer-term. If we can break down below the $14 level, then the market could go to the $12 level which was even more supportive. Currently, the only silver I am buying is in its physical form, because if you take the leverage out of it Silver can be held onto for quite some time.

In the meantime though, look for signs of exhaustion on short-term rallies as I think we are almost going to have to go down to the $14 handle.

Crude Oil Price Forecast – oil bounces to kick off week

WTI Crude Oil

The WTI Crude Oil market bounced a bit during the trading session on Monday, as the $50 level has offered enough support to have people jumping into the market. The $50 is of course a psychologically important figure, and I think that the market is bouncing from and oversold condition, but quite frankly I think that the market bouncing will probably be an opportunity to short yet again. However, if we break above the $57.50 level, then we could possibly go even higher. If the $60 level was to get broken, then we could get serious momentum to the upside.

Brent

I believe that Brent markets also looking to bounce a bit from and oversold position, but then should find exhaustion that we could take advantage of to short yet again. However, one thing that you should pay attention to is whether or not the Saudi Arabia and Russian government start to cut back on production. The way the oil markets have collapsed, one would think that we should hear that sooner rather than later, but at this point we don’t have any type of signs that it’s ready to happen yet, so in the meantime I think you continue to fade rallies that show signs of exhaustion. However, as soon as ministers start to talk about cutbacks, I think this market will take off. Alternately though, if we can get the US dollar to soften a bit, that could also give the crude oil market a little bit of a boost.

Natural Gas Price Forecast – natural gas markets gap lower to kick off week

Natural gas markets initially gapped lower to kick off the week, reaching down towards the $4.00 level. While we do have cold temperatures coming to the United States and of course the seasonality that goes along with this market will continue to help the buyers. However, we had gotten far ahead of ourselves and I now think we are essentially trading in a range bound market between the $4.00 level, and the $5.00 level above. Looking at the chart, I think it’s likely that we will continue to go back and forth, but longer-term we will eventually start trading Spring contracts, which will drive the value of natural gas down.

NATGAS Video 27.11.18

I think volatility is something you can probably count on, so think of the outer ranges of this market as essentially the boundaries of where we should trade. However, if we break down below the $4.00 level, then we could go down to the $3.75 level next, and perhaps even the 50 day EMA just below there. I certainly think that will happen eventually, but we are probably several weeks away from that type of trading. In the short term, I like fading rallies as it looks like we have gotten so far ahead of ourselves that we may have already printed the highs for the winter months near the $5.00 level. Patience will be needed but I think that plenty of supply is coming online due to the higher pricing.

Gold Price Forecast – Gold markets quiet to start the week

Gold markets did very little on Monday as we continue to dance around the $1225 level. It’s essentially the middle of the overall consolidation area between the $1200 level underneath, as well as the $1250 level above. As we dance around the $1225 level, we are also dancing around the 50 day EMA, which of course is very technically important. The last couple of days have been rather quiet, and at this point I think the market is trying to figure out where to go next. A lot of this hesitation is probably in confusion as to what to do about the greenback itself.

Gold Analysis Video 27.11.18

I would point out that there is an uptrend line underneath that slices through the $1200 level, which also shows signs of support. If we were to break down below this uptrend line, and the $1200 level, it would be very negative for gold. Alternately, if we did break above the $1250 level, then the market would probably return to the overall consolidation area that we had been in for longer-term trades, between the $1200 level in the $1400 level. If we do break above $1250, then one would have to assume that we will try to go back towards the top of that consolidation zone, and it would make it a very bullish move.

Pay attention to the US dollar though, as it is very influential as to where the Gold markets go at times. If we do break down below the $1200 level, then I think we could go to the $1000 level. That’s an area that will be massive in its influence and importance, and I think a lot of value hunters would come in if we did go down there.

Natural Gas Price Fundamental Daily Forecast – Testing Value Zone at $4.082 to $3.873 While Waiting for Updated 10-14 Day Forecasts

Natural gas futures are under pressure on Monday after gapping the opening to the downside. The early selling stopped on a short-term 50% retracement level which suggests investors may be looking for value. And who can blame them as the market continues to try to recover from the volatile price surge on November 14.

Reports continue to come in about hedge funds and pensions getting blown out of the market during that extremely volatile session. It’s hard to gauge the market at this time with many of the major players still licking their wounds. I’m guessing that “when in doubt, stay out” is the strategy for some at this time.

At 1244 GMT, January Natural Gas futures are trading $4.090, down 0.265 or -6.08%.

There weren’t any major changes over the week-end, but since we’re still in a weather market, I have to assume that the selling pressure is related to profit-taking or position-squaring rather than aggressive short-selling.

Additionally, rather than chase the market higher on the headlines, the new strategy may be to buy value.

The price action may also be suggesting that the near-term cold weather patterns have been priced into the market, or fully-hedged.

NatGasWeather has put out a new forecast for November 26 to December 1. It says, “A strong weather system with rain snow and ice will track across the Southern Great Lakes, Ohio Valley, and Mid-Atlantic the next several days, eventually through the Northeast. Temperatures behind the cold front will reach the -0s to 20s across the northern and central US, with 20s and 30s into Texas, South, and Southeast. Mild high pressure will build across the central and southern US late in the week, then expanding across the East this weekend, with temperatures warming into the 50s to 70s for lighter national demand. The West will see a mix of mild and cool periods as weather systems track through. Overall, nat gas demand will be increasing this week to high-very high, then easing next weekend to moderate.”

Forecast

Fundamentally, traders will be watching daily demand figures and the latest weather forecasts for any major changes. Remember, the professionals are always looking 10 to 14 days out so try not to get too hooked on current weather conditions. Yes, it is cold and snowy in Chicago, but apparently not cold enough. Furthermore, the bulls in this market wants to see lingering cold systems, not “one-and-done” cold snaps.

Technically, the main range is $3.199 to $4.964. Its 50% to 61.8% retracement zone at $4.082 to $3.873 is the primary downside target. This zone is controlling the near-term direction of the market.

The short-term range is $4.964 to $3.898. Its retracement zone at $4.431 to $4.557 is the new resistance.

Currently, the market is straddling the upper or 50% level of the main retracement zone at $4.082. Treat this price like a pivot today.

Price of Gold Fundamental Daily Forecast – Supported by Fear of Slowdown in Global Economic Growth

Gold futures are trading higher on Monday shortly before the regular session opening. The market is being supported by fears of a slowdown in global economic growth which could curtail central bank attempts to raise rates, especially the U.S. Federal Reserve. Uncertainty over trade dispute discussions between the United States and China at the G20 summit in Argentina this week-end is also underpinning prices.

At 1153 GMT, December Comex Gold futures are trading $1226.00, up $2.80 or +0.23%. We’re rolling over to the February futures contract on Wednesday.

Gold has been strengthening since the week-ending November 16. That was the week the U.S. Dollar posted a potentially bearish technical closing price reversal top. It did follow-through to the upside last week, but the move was thwarted by last week’s rally in the U.S. Dollar.

Two weeks ago gold started rallying after the release of the consumer inflation report. It was further supported by somewhat dovish comments from a couple of Fed officials, who suggested the central bank may be nearing neutrality as far as rate hikes are concerned.

Last week, gold was supported by a series of weaker-than-expected U.S. economic reports including Durable Goods, Consumer Sentiment, Manufacturing and Services PMI and Weekly Jobless Claims.

However, the gains were offset by a week-long sell-off in the U.S. stock markets which raised demand for the safe-haven dollar.

Forecast

There are no major economic reports today, but investors will be keeping an eye on the U.S. Dollar. If conditions continue to improve in the stock market then the dollar is likely to weaken. This should drive up demand for dollar-denominated gold.

Gold is likely to strengthen on a sustained move over $1227.10. The potential trigger point for an acceleration to the upside is $1230.90. The daily chart shows there is room to the upside with targets at $1239.30 and $1246.00.

A sustained move under $1221.30 will be a sign of weakness with $1215.20 the next likely downside target.

Oil Price Fundamental Daily Forecast – Seeing Light Short-Covering, but No Signs of Aggressive Counter-Trend Buying

U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading higher shortly before the regular session opening as traders try to claw back some of last week’s steep losses. U.S. crude is holding above the psychological $50 level, but Brent is having trouble with the psychological $60 level.

At 1050 GMT, January WTI crude oil futures are trading $51.03, up $0.61 or +1.23% and January Brent crude oil is at $59.88, up $1.08 or +1.84%.

There haven’t been any major developments on the fundamental side of the equation, but technically, the market is oversold according to some “coincidental” indicators. Also helping to underpin the market is stronger global equity markets.

The price action suggests the early price action is being fueled by light short-covering. So far there is no evidence of aggressive counter-trend buying, but this comes as no surprise since there are still lingering concerns over rising supply and production, and worries about lower global demand.

In other news, government data showed that managed short positions in nearby WTI crude futures have surged from record lows in July to the highest number of short positions since October 2017. The data also showed that the number of put options in February Brent crude oil futures at $55 and $50 per barrel has surged to record levels since October.

The future looks bleak for prices also, despite increasing expectations for production cuts by OPEC. According to reports, the downward pressure is still coming from surging supply and a slowdown in demand, which is expected to overhand into 2019.

Furthermore, some analysts are even casting doubts over the impact of the expected production cuts. According to Fitch Solutions, supply cuts “may not be enough to counteract the bearish forces”.

Morgan Stanley said, “We don’t think that we are at the bottom of the cycle yet.”

Forecast

We could see further short-covering today but the market is going to need help. Look for the early strength to continue if the U.S. Dollar weakens and equity markets continue to strengthen.

Limiting gains and perhaps pressuring prices lower will be renewed weakness in the equity markets and a stronger U.S. Dollar, which will reduce foreign demand for dollar-denominated crude oil.

Traders will also continue to monitor developments over U.S./China trade relations. However, nothing is expected to change until the G20 summit over the weekend.