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Precious Metals and Crude Oil Shows Signs of Strength

Technical Analyst, Trader, & Founder of Technical Traders Ltd
July 14, 2011

The past couple months (May and June) have been tough on precious metals and crude oil. But recent price action shows that buyers are stepping back into the market buying up these commodities once again.

Let's take a quick look at the charts…

Gold Futures Daily Chart

As you can see from the chart below, gold is making a new high. The big question is if it will do what it has done many times in the past, which is make a new higher for only a few days to get the general public (herd) long, only to then get sold into and come back down? The next few sessions will give us a better feel for this breakout/rally.

Silver futures Daily Chart

Silver on the other hand has not performed as well as its yellow sister. Rather we are seeing a base being formed. The exciting thing about base patterns is that the larger and longer the base takes to form, the larger the potential move once a breakout occurs.

Crude Oil Hourly Chart

Crude oil looks to be forming a base and or inverse head & shoulders pattern. Both these patterns point to higher prices with a price target around the $110-112 area.

Mid-Week Trend Report

In short, I feel commodities are now in the spot light and where investors will be looking to put their money to work over the next couple weeks as the falling dollar directly helps boost their prices.

The equities market continues to be volatile with large waves of buying and selling almost hitting the them every trading session. During key pivot points in the market we know pricing for investments get a little crazy at times and we manage positions accordingly and anticipate some moves.

Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several financial hubs like MoneyShow.com.

 


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