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Commodities Hold The Higher Ground

Global commodity markets have spent four days holding the higher ground, and consolidating the break-out moves that started on 14th February. As global equity markets lost ground there were moves into hard commodities, which went on to consolidate recent gains and hold solid test of support.

Gold trade is holding around the 1400 price point, with a very strong long trend, and very clear long momentum reads that would take a break below 1370 to switch into short mode. It may be unwise to try to buy a new break-out from these levels; instead traders may be looking to buy the dip on any tests of 1390.

Silver bullion maintains its bullish undertones, with price action holding around 33.30 after a period of trade that consolidated a very strong move which broke the 31.00 price range. Tests of support are being bought at this point in time, in a signal that the global market has found fair value on silver. In-line with gold trade, it may be unwise to look to buy at these extended levels, with a more cautious view being the purchase of any tests of support around the 31.50 price point.

West Texas intermediate, the most liquid of all global oil contracts, has shown the reasons why investors and traders need to mix a blend of technical and fundamental analysis into their daily work. After an explosive move higher that broke through 88.00 resistance, the oil commodity is now easily trading around 98.00. The asset class has taken on investment grade characteristics, and is holding a solid long trend on all time frames. Oil has strong sentiment to the long side, solid price action, and momentum reads that are buying the dips on any tests of support.

In general, hard commodity prices look to have found fair value, albeit at extended levels in the near-term, that may become the norm so long as social unrest continues to dominate mass media headlines. Intra-day alerts will come from TheLFB’s SMI (sentiment and momentum index) that will e-mail clients with notification of any change in sentiment trend and price.

Intra-day Commodity SMI
The SMI detail shown below forms part of TheLFB subscription service that analyzes global market trade, including intra-day trend, momentum, and price action points that use 1-hour charts for analysis.

    * Gold Bullion (Mixed)
      Long momentum, flat trend. Long from 1412 targeting 1416. Short from 1404 targeting 1396
    * Silver Bullion (Mixed)
      Long momentum, flat trend. Long from 33.50 targeting 33.75. Short from 32.70 targeting 32.40
    * WTI Crude Oil (Long)
      Long momentum, long trend. Long from 99.50 targeting 100.80. Short from 97.30 targeting 96.25
    * 10-year Treasury Note
      Long momentum, long trend. Long from 120.25 targeting 120.32. Short from 120.00 targeting 119.85