Gold Maintains Luster, While Oil Nears Bottom
05/08/2007
Although the overall commodity complex (oil, et al) has not performed very well of late, gold prices and the GLD apparently are the exception.
Since last Tuesdays upside pivot reversal off of the rising 50-day moving average at 66.11, the GLD (streetTRACKS Gold Shares ETF) has climbed to 68.48 so far and appears poised to challenge the April high at 68.73.
If that's hurdled, that should trigger upside acceleration towards my next optimal target zone of 72.00.
At this juncture, only a decline that breaks the 50-day moving average will compromise the developing bullish pattern.
Moving over to oil, my hourly work on the U.S. Oil Trust (AMEX: USO) indicates that in the 47.50 area the USO hit a swing target, corrective low, and since has started the process of establishing a near-term pivot bottom.
At this juncture, I would not be surprised to see a false start or two, and-or a retest or two of the 47.50 area prior to a sustained potent upmove that initiates a new upleg in the larger recovery rally period off of the Jan lows.
For now, key resistance hovers at 49, which must be hurdled and sustained to confirm that a meaningful low has been established.
Mike Paulenoff is author of the MPTrader.com (www.mptrader.com), a real-time diary of his technical analysis on equity markets, futures, metals, currencies and Treasuries.
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