Commodities Technical And Fundamental Analysis For July 15, 2011

Light Sweet Crude

The CL fell on Thursday , and even fell to the $95 mark. The $95 level did act as support, and this suggests that perhaps the buyers are still available and willing to buy on the dips. We have suggested as much too, and because of the recent price action, we feel that buying on the dips will be the way to go as this market still wants to go higher.


The Brent contract was fairly neutral on Thursday as the market traded in a very tight range. It should be noted that the $120 resistance area is right above, and that it could push prices lower. Because of this, we are waiting for a daily close above $120 in order to buy, or perhaps if we get a substantial dip we could get involved as well. We are not interested in selling.


Oil Fundamental Analysis for July 15, 2011


Crude oil prices fell on Thursday , as the U.S. dollar gained back against major currencies, which put downside pressure on crude oil prices, noting that crude oil prices were higher earlier on Thursday, as the USD dropped after Moody’s signaled it had put the outlook for U.S. debt under negative review, but the U.S. dollar was able to gain back, as investors remained focused on the EU debt crisis, and the prospects that Italy could be the next victim of the crisis.

Mounting speculations of QE3 could still weigh down on the USD, and accordingly, that could provide crude oil prices with more bullish momentum, nonetheless, the uncertainty surrounding the outlook for global growth and the ongoing concerns from the European debt crisis could still weigh down on crude oil prices.

Friday July 15:

The U.S. economy will also end the week on a high note with heavy data starting at 12:30 GMT with the Consumer Price Index for June . The index is expected with 0.1% drop following 0.2% rise and to hold at 3.6% on the year, yet core inflation is expected to rise 0.2% on the month following 0.3% and tick slightly higher to 1.6% on the year following 1.5%.

At 12:30 GMT as well the Empire Manufacturing Index for July is expected with a strong rebound to 4.0 from -7.79. Industrial Production for June is due at 13:15 GMT and expected with 0.4% increase following 0.1% and capacity utilization to rise to 77.0% from 76.7$.

Finally University of Michigan will end the day at 13:55 GMT and the preliminary July reading is expected with improvement to 72.5 from 71.5.

Natural Gas Technical Analysis for July 15, 2011

The natural gas markets fell hard on Thursday, but bounced even harder. Because of this move, we have formed a hammer on the daily chart, and it looks like we are winding up for a surge upward. The market is caught in consolidation between $4 and $5, and at these lower levels, one has to favour the upside.

Natural Gas Fundamental Analysis for July 15, 2011


Natural gas prices fell on Thursday after the EIA report showed natural gas inventories rose above expectations, where the EIA report signaled that natural gas inventories increased by 84 billion cubic feet, compared with the prior estimate of 95 BCF and above median estimates of 79 BCF, which weighed down on natural gas prices.

Nonetheless, expectations of warm weather conditions could push natural gas prices back to the upside, since it will increase speculations of rising demand for power-plant fuel to meet rising cooling demand.

Gold Technical Analysis for July 15, 2011

The gold markets rose on Thursday , but ended the day only slightly to the upside. The market is breaking to new highs, and because of this, there is often a pullback as traders begin to question whether or not the high prices are warranted. However, as the trend is up, one has to think higher prices are in the future as well. The fact that the last two weeks has basically only been green candles, a pullback only makes sense. We are buying on dips, and we expect those dips to appear in the near future.

Gold Fundamental Analysis for July 15, 2011


Gold is still bullish and on the rise extending the rally on Thursday and aiming at the $1,600 mark. The dollar weakness and the prevailing jitters prompted strong gains for the precious haven on rising uncertainty over the outlook .

The dollar was generally the talk of the town on Thursday after Bernanke triggered the strong weakness with hints for the possibility to expand the stimulus to support the economy shall the weakness continue to broaden.

More downside pressure on the dollar was from Moody’s downgrade warning to the United States shall they fail to reach the decision to raise the debt ceiling in time which will subject the nation to lose its top rating.

Also Fitch’s move on Greece where it cut the status again to the lowest in the world, which was of little effect since it was no new surprise and followed other agencies, still reminded the market of the prevailing debt woes. The debt woes have transferred to the United States after Moody’s warned that the delay in raising the debt ceiling will cost the U.S. its top credit rating.

Volatility remains evident and on Friday we expect the jitters to dominate the scene especially as the European continent focus on the release of the stress test results after the stock markets closing, and the lack of major data from Europe will intensify the fluctuations, the debt crisis on both sides of the Atlantic is the upside support for Gold and we expect choppy trading for gold with the end of the week and position covering ahead of the weekend.

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