Crude Tumbles & Gold jumps on Weak News from Europe; traders prep for Jobless Claims

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The James’ Report: Professional Resources for Professional Traders

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Gold Futures head back to all-time highs on global slowdown and more fear from Europe

Crude Oil Futures tumble on weak news from Europe and fear of less demand globally

Euro Futures fall off their mid-term highs from Wednesday on lackluster jobs numbers

Global News…

– UK Retails Sales disappoints

– European equities slump on global growth concerns

– European shares opened lower dragged by overall fears of a global slowdown and the lackluster meeting between Merkel and Sarkozy.

– A senior US official commented that China VP Xi was confident with the fundamentals of the US economy and did not show concern regarding US debt

– German credit association official stated that it could not rule out additional private sector participation in case of further crisis in the EU

– India Central Bank Dep Gov Sinha: Taming inflation remains the top priority for the RBI

– Data released from the Bank of England indicate that they believe in a 1 in 10 chance the UK will experience a double dip recession over the next 18 months, and a 1 in 8 chance that the economy will contract in the current quarter according to an article in the Telegraph.

– Following yesterday’s jobs data, the British press reported part-time employment in the UK hit a record high.

The figures were even more staggering for youths (16-24 year olds) where unemployment is above 20%.

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Today’s Economic News:

Looking at today’s news, we begin with 830am Jobless Claims and Consumer Price Index news to hopefully get these markets moving for us. We then have the US markets opening at 930am followed by 1000am Philly Fed Survey and Existing Home Sales. Philly Fed will be important for crude oil, so pay attention to this today. We also have a minor news at 1030am Natural Gas Report which will not have much impact on the markets we trade most often. We do not expect to see much volume after 1045am today due to OPEX tomorrow morning so traders will be hitting the exits early to possibly get their weekend started ahead of OPEX during the summer months. Pay close attention to volume after 1030am today as it will be slowing down quickly.

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Looking at the Charts:

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Crude Oil Futures are falling off recent highs this morning over less demand for this ‘black gold’ across the globe. We can see a bull price channel and lots of support levels below us for buying opportunities. Avoid the middle of this range and the BMT around 84.85. Bull channel says to buy pullbacks with new higher highs and to buy at major support levels such as 85.63, 84.39, 84.00, 82.69, 81.88. And remember that when these support levels are broken we will then sell retracements for short term profits down to the next level of support below us.

Gold Futures are on a rocket ship back to the all-time highs this morning on continued fear over the global economy. With the US slowing down, and the ECB crisis on its 100th chapter and counting traders and investors are betting that gold will keep going higher today. The key today will be to sell the all time highs of 1820 area being selective only to take trade around the highs that are either deep pullbacks (34 and 21r wave patterns) or 2step short off slower timeframes such as 21/34/55/89range charts. You are not going to have a lot of luck trading pullbacks on faster timeframes most likely because price action will be sloppy around these highs so beware of that.

Euro Futures are trading back off their range highs from Wednesday on weaker news from Europe overnight. We’ve been trading the Euro with a very simple plan this summer, trade the sideways range and the price wedge by selling at the highs and buying at the lows. This simple strategy has made great profit and is the best way to trade this type of price structure. The key to this next trade will be to wait for price to move back up (or down) out of the middle of the range and into an area where we can sell the highs of 4512/4472/4395 or buy the lows around 4145/4100/4041.