Gold, Silver, Oil & Nat Gas Technical Trading Setups

July 27, 2009

Commodities are trying to hold their ground and could go either way quickly. There is a lot of chatter going on about gold and silver. I am hearing extreme theories from everyone I talk with. Generally when I see the market get jumpy we tend to see volatility increase which translates into sharp rallies or sell offs.

My finger is on the trigger for Gold

Below are two charts of gold (GLD fund). The first one is what I would like to see before we have a low risk setup. This chart will not only lower the overall risk but increase the odds that the rally will provide more profit. Buying after a pullback actually helps to lower the down side risk because many sellers have been flushed out.

The chart below shows what could very likely happen tomorrow. If prices move higher and the intraday price action generates a low risk entry point I will be sending out an alert. This type of setup has a lower win rate but many times the rallies from these are quick and powerful. Locking in a profit is crucial when trading steeper trend line rallies.

My finger is on the trigger for Silver

Silver has already started to move to the upside but the intraday price action did not generate a low risk buy signal. It was very close on Friday but not enough. This chart below shows what I would like to see happen to silver.

The Silver chart below is currently trying to start a new rally higher and just may happen on Monday. I will be sending out an alert if we get the proper price action tomorrow.

Crude Oil

Crude oil has had a solid rally higher and is now trading at both Trend line resistance and price level resistance. Currently we are not near a setup.

Natural Gas

Natural gas had my attention several weeks ago but is now an underdog. We need more time for this commodity to bottom before we can get anything good from it.

Technical Trading Conclusion

Overall commodities have made up some lost ground in the past couple weeks, but are now trading at short term resistance levels. What does that mean? Well the odds are in favor that we will see some profit taking pulling prices down a little and allowing for a low risk setup before taking another run higher.

Gold and Silver could be exciting tomorrow depending on the intraday price action. I will keep members posted as the day unfolds.

 

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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.

The Fourth Coinage Act of 1873 embraced the gold standard and demonetized silver, known as the “Crime of 73”