Wednesday, January 26, 2011

Gold: Short Term Crossroads

  • Gold (Feb Comex) is currently testing recent swing lows and the 38.2% Fibonacci retracement level from the July 2010 lows.
  • The loose cluster of geometric dates in this time frame could possibly coincide with a short term low.
  • Resistance will found near 1380-1382 and near 1394-1396.

The weekly chart needs significant deterioration from current levels before the intermediate-long term trend is jeopardized. The July weekly swing low is the critical level to monitor. If gold breaks down from current levels, a quick decline to 1255-1260 is likely.

S&P 500 (E-Mini)
  • S&P (E-Mini Mar. ) is trading higher Tuesday evening surpassing the previous swing high. A test of the 1296 is likely with a possibility of a rally extending to the 1305 level.
  • If this were to occur, several technical indicators would likely set up non-confirmations. 1261 remains the critical support for the short term.
  • VIX is meeting resistance at the 18% level. A break of 1261 will not occur without the VIX breaking to higher levels.
  • Transports week chart structure should be monitored closely.

No comments: