Noteworthy Short Term Fails For Gold and Oil

Gold
The gold price has been in a quiet, almost 'under the radar' rally since early summer.
Down trending indicators have bottomed and show modest positive action. A big test
came this week when gold confronted trend resistance at the $1350 oz. level. It failed
to take it out and quickly lost $37 on the lack of success. It thus remains in the 'dead
cat bounce' category until it can push up through the down line and rise above short
term resistance at $1350. Gold Price The bear has yet to be upended in the short run.

Oil
The oil price remains in a robust period of seasonal weakness, and broke trend support off
the 2012 level of $80 bl. this week. I expected a little tougher battle, but news of rising
supply trumped that. My hope has been that continuing seasonal weakness would carry oil
down to $85 in early 2013. That might provide a terrific long side trade, and would also be
a nice plus for the consumer who is already enjoying a weaker gasoline price. Oil Price
Oil is coming off very quickly and you will note the weekly RSI is moving smartly to an
oversold position. This does not dim my hope, but it is time to be more watchful now for a
bounce in the weeks ahead.