My previous post discussed the bearish tone in the equity markets, but there is also a bearish tone in commodities, particularly in oil & gold. It all translates to a slow down in the global economy.
Oil had a topish formation, with big up days on low volume & down days on higher volume. The move was fierce when it broke through on the down side. It then formed a bear flag, with a big move downward. It already broke though 72.65 support, with 68.58 in sight, with 66.55 not to far away after. I expect lot more downside at the break of 66.55.
Gold is similar. It had a tough time reaching new highs & volume was low. When it finally broke though a trendline (2 trendlines a matter of fact!), it was on extremely high volume. There was a trendline comeback to the 2nd trendline it broke through, providing another opportunity to short. It is approaching another trendline (apx. 1180ish) & support at 1171.30. At the break of 1171.30, expect lot more downside, as most of the support areas are relatively minor.