#Gold,#WTI Crude Oil,Natural Gas Technical Analysis:31 JAN 2022

Gold Forecast: Gold Continues to Wait for Jerome Powell

In the next candle or 2, things will be quiet and then get suddenly volatile.

• Gold markets initially trying to rally during the training session on Monday, but we continue to see a bit of hesitation just above.
• This makes quite a bit of sense because the market has run rather hard to the upside, and eventually you need to find more buyers to get involved.
• This is not to say that I think that the trend is over, just that I think a pullback is almost certainly going to happen rather soon.

A Pullback Is On Sight

I anticipate the Jerome Powell could be what it’s waiting on, as there will be a press conference after the interest rate hike on Wednesday. Whether or not he chooses to be tight with monetary policy you will be open for debate, but I think this is a situation where the market is trying to figure out what to do next as it had gone too far. I think it would make a lot of sense to see gold pull back a bit heading towards that announcement, as traders try to take profit. Think of it this way, if you have been long with gold this entire time, you have made a killing, so there’s no point in giving back a bunch of money due to a liquidity drain around this major announcement.

If we do get that pullback, then I think the $1880 range does make a certain amount of sense for the initial pullback, because it was such a major resistance barrier previously. A move down below there then opens up the possibility of the $1850 level, which has a certain amount of psychology attached to it. The 50-Day EMA sits underneath there and is rising to meet that area, so I think that makes quite a bit of sense.

On the other hand, if the Federal Reserve shocks the market somehow in a very dovish tone, then I think we break above the highs of last week and go look into the $2000 level. I do think that we are more likely than not going to see traders tried to push this market to the $2000 level, but it may take a certain amount of time to get there. I do like the idea of buying dips as opposed to chasing momentum, but we will have to wait and see whether or not we get that type of value. In the next candle or 2, things will be quiet and then get suddenly volatile.

WTI Crude Oil Forecast: Continues the Same Choppy Behavior

I don’t expect to see a major meltdown, but then again, I don’t expect to see oil take off to the upside easily either.

The West Texas Intermediate Crude Oil market drifted a bit lower during the trading session on Monday but did bounce from the ultimate lows. It looks as if it is still trying to pay attention to that neckline from the inverted head and shoulders, as that’s essentially where we bounced from. We also have the 50-Day EMA in the same neighborhood, though a lot of things going on at the same time.

Keep your Position Size Reasonable

• With that being the case, we would probably see economic activity dropping as negative for this market, but it might not necessarily be a complete meltdown, because the Biden administration used the Strategic Petroleum Reserve in the United States to buy votes before the last midterms and will have to replenish it sooner or later.
• In other words, the United States government probably will provide a little bit of a floor in the market, but that doesn’t mean we can drop.
• The $75 level underneath should be a significant support level, just as the $81.50 level above should be a significant resistance barrier.

In the meantime, I think this is more or less going to be back and forth walking along the 50-Day EMA, but perhaps pulling back just a bit. I don’t expect to see a major meltdown, but then again, I don’t expect to see oil take off to the upside easily either. Short-term range-bound traders will probably love this market over the next several days as it tries to figure out where it wants to go. Keep your position size reasonable, because it’s easy to get chopped up in this type of environment.

Natural Gas Technical Analysis: The Price is Deepening its Losses

January settled as generally mild and while there were winter storms in December these proved short-lived, leaving the market weak in terms of sustained demand.

Spot natural gas prices (CFDS ON NATURAL GAS) settled down during its early trading on Tuesday, achieving slight daily gains until the moment of writing this report, by 0.57%. It settled at $ 2.845 per million British thermal units, after declining during yesterday’s trading by 0.5%. -6.57%.

Natural gas futures settled at their lowest levels since April of 2021, amid expectations of warmer weather in the East Coast and parts of the central regions of the United States. Natural gas prices settled on Thursday at their lowest level since May 2021 and recorded a day Friday, its sixth straight weekly loss.

Warmer weather is likely to dampen demand due to weather and further support the possibility that storage levels will end the winter season with a surplus above the five-year average.

Traders also focused on strong production and expectations of mild weather in mid-February, which sent natural gas futures lower on Monday.

The Nymex gas futures contract for the month of March fell in its first regular session as a spot month by 17.2 cents per day, and settled at $2.677 per million British thermal units. The April contract lost about 14.7 cents to $2.731.

January settled as generally mild and while there were winter storms in December these proved short-lived, leaving the market weak in terms of sustained demand.

Natural Gas Technical Analysis

Technically, natural gas continues its decline amid the negative signals of the relative strength indicators, despite reaching areas that are highly saturated in selling operations. Negative pressure continued due to its continuous trading below the simple moving average for the previous 50 days, in addition to that the bearish trend dominates the price movements in the short term and along the line Slope, as shown in the attached graph for a (daily) time.

Therefore, our negative expectations surrounding natural gas continue as long as it remains stable below 3.098, targeting the first support levels at 2.432.

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