Gold, Silver & Energy Commentary Update Wed Morning

PRECIOUS METALS 

February gold closed higher on Tuesday due to short covering as it consolidated some of Monday’s decline. The high-range close sets the stage for a steady to higher opening on Wednesday. Despite today’s rebound, stochastics and the RSI have turned bearish signaling that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 844.10 are needed to confirm that a top has been posted. If February extends this fall’s rally, October’s high crossing at 938.80 is the next upside target. First sesistance is last Monday’s high crossing at 892.00. Second resistance is October’s high crossing at 938.80. First support is the 20-day moving average crossing at 844.10. Second support is today’s low crossing at 838.80.

March silver posted an inside day with a higher close on Tuesday as it consolidates some of Monday’s decline. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If March extends the rally off October’s low, the reaction high crossing at 12.230 is the next upside target. Closes below the 20-day moving average crossing at 10.735 are needed to confirm that a short-term top has been posted. First resistance is Monday’s high crossing at 11.770. Second resistance is the reaction high crossing at 12.230.
First support is the 10-day moving average crossing at 10.930. Second support is the 20-day moving average crossing at
10.735. 

ENERGY MARKETS 

February crude oil closed slightly lower on Tuesday due to light profit taking as it consolidated some of the rally off December’s low. Today’s mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If February extends this month’s rally, the reaction high crossing at 52.95 is the next upside target. Closes above the reaction high crossing at 52.95 are needed to confirm that a short-term low has been posted. Closes below last Wednesday’s low crossing at 36.94 would temper the near-term friendly outlook in
the market. First resistance is today’s high crossing at 50.47. Second resistance is the reaction high crossing at 52.95. First support is the 20-day moving average crossing at 43.96. Second support is the 10-day moving average crossing at 41.94.

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Chris Vermeulen