30.09.2011 - Gold, the constant

The sign of economic rebound faded. People are selling their stocks and moving to the gold market once again.

As I predicted in my prior blog entries, gold is moving up where as stock markets show indecision.

Brent Crude Oil

The lows of the past 4 months established a support-line at 103 points. Additionally the highs of the past 5 months created a falling trend-line. Both lines represent a pennant. The outbreak off this pattern in general is a big movement in either direction on high volume.

Oil price will rise to approximately 113 points in the coming month.

EURO STOXX

For almost 2 months the Euro-Stoxx 50 did not establish a clear trend-line. However, in this time prices moved between 2.000 points and 2.300 points.

In my opinion one should not trade the Euro-Stoxx 50 until a clear trend or outbreak of the above mentioned zone occurs. The economic situation of Greece has a great impact on overall price-level of european stocks.

DAX

The situation for DAX is similar to Euro-Stoxx 50: price does not show a strict direction. Some analysts say that currently you have a cheap entry level on stock-indexes. This is true in that prices are relatively low, but just one bad news about the world economic situation and price is pushed further down.

Trading the DAX is risky as there is no trend and high market volatility. Stay out.

DJIA

The Dow Jones Industrial Average (DJIA), after violating its prior uptrend, now seems to be trending downwards.

One can trade the Dow Jones expecting a downtrend with Stop-Loss settled at 11.400 points. 

GOLD

Gold-price did not show a big move in the past days. This is common after volatile markets and a sign of an upcoming rally.

The situation did not change and as long the Stop-Loss at 1.530 is not triggered. Price-target is around 1.700-1.750 points, with plenty of room to the top.