Gold and Oil Take a Turn to the Upside
December Gold (GCZ7) went on a run with the bulls today, gaining 25 points for a close back over the $800 level. Meanwhile in the Crude Oil market, the January contract (CLF8) set another new record, closing at $98.38. Both of these contracts had a big day to the upside while the Dollar set another new record low.
Looking at the charts, Gold had a bit of a reversal in relation to the past three days in the red, closing above the $800 level for the first time in several days. The 800 mark is becoming a weak level of psychological resistance at best, and a consolidation pattern may be forming around that number. The true measure of this rally will be revealed when and if Gold manages to top the 840 level like it did earlier this month.
Oil kept traders on the edge of their seats again today with a new record high of 98.62, as the $100 level again emerges as a reachable target. As usual, tomorrow’s inventory number at 9:30 AM Central time will be a closely watched event, and may be the catalyst to send prices to that $100 level.
In the news, housing starts came in 3% higher than October, while building permits took a bit of a slide. This is mixed information, but for the sake of the housing market, any good news is welcome. However, the big news on the day was the FOMC minutes, in which the Fed noted the potential for a slowing economy over the next year. The Fed also indicated that its October decision to cut rates was a “close call."
Mike Tosaw, Director of Education
