Crude Oil has shown an impressive recovery from the monthly demand zone around $45, closing April with a bullish engulfing candle. Should it continue going up, a new demand zone may form between $46 and $53.50 (light blue rectangle.) On the upside, the chart may find resistance around the broken demand zone of $71-$80.
The weekly chart is showing a confirmed double bottom, whose potential target is around $66. A test of the neckline around $55.80 has already occurred, but if the price goes down to that zone again, it could provide those who are looking to buy the commodity with a good risk:reward ratio.
Gold has been consolidating for many months between roughly $1100 and $1400, testing the resistance-to-support line of $1180. The monthly chart is still compressing slowly inside a falling wedge, which is essentially a bullish pattern. The wedge is forming just above a demand zone, whose top is around $1100. Usually, the compression into a demand zone shows that the institutional firms (banks, hedge funds) are in the process of accumulation: buying large amounts over a long period as long as the price is "cheap" and attractive enough. The same process may be taking place via another precious metal, with JP Morgan accumulating physical silver.
Technically, only closing outside the upper trend-line of the falling wedge will confirm a bullish move, but prior to that, bullish price action—in the form of a big bullish engulfing candle, a morning star or other strong bullish candle patterns—may suggest a coming upward move in gold. On the other hand, closing below the demand zone could signal another leg down.
The US dollar has just formed an interesting bearish engulfing candle on the monthly chart, after going up for nine consecutive months. If the index keeps going down, it may form a monthly supply zone between 96 and 100, with no apparent demand zone all the way down to around 80. The top trend-line of the breached triangle could serve as support, should the index go that far down. A retest of the weekly or daily supply zone within the monthly supply zone, with clear price action, may give the signal for further decline.
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