December Gold achieved the 450 objective mentioned in my 11/02/04 Fast Break. We are now tracking the February contract. Gold remains in a strong up trend and has moved up to resistance in the 450 area. There is resistance above at 460 based on a line off the monthly chart. Look for a correction to buy long, with support at 435 and 430. Closing above 460 would point to an objective of 485. Gold Futures Quotes + Charts
Silver continues to struggle. Key support near 7.00 held, but we haven't seen a strong move to 8.00. Lack of momentum leaves this market vulnerable to sharp setbacks. In the March contract, support is near 7.40 and 7.20, and if the trend holds there is an objective of 8.40. Silver Futures Quotes + Charts
Support at the Fibonacci (61.8%) retracement near 125.00 held in the December contract and the up trend has resumed. The March contract has moved to new contract highs in this past week, and there appears to be some resistance now above 140.00. Support is at 138.00 and 134.00 and after a correction look for an objective of 155.00. Copper Futures Quotes + Charts
March becomes the front month (most actively traded) contract on Monday 12/06/04.
Without much of a correction, the Euro has moved to new lifetime highs and met the previous objective of 1.3300 (B) noted in the 11/02/04 Fast Break. Support is at 1.3100 and 1.2850. Having reached the objective and without a new high in Momentum (C), the Euro may correct down some from here. The larger objective of 1.3800 is now in sight and it appears to be a question of when, not if, it will be met. Eurocurrency Futures Quotes + Charts
After a correction, the .9550 objective mentioned in the last update was exceeded. This sets up a new objective range of .9910 to .9920. The flattened Momentum indicator suggests this move will take some time and the market is vulnerable to a correction. Support is at .9700 and .9550. Continue to trail stops below the low average to protect profits. Japanese Yen Futures Quotes + Charts
The Pound has sustained a break out above 1.8400 and rallied to new contract highs. This points to an objective of 1.9600, which coincides with the '91 and '92 peaks of 1.9800-2.0000. Continue to be long as support holds and the up trend stays in force. Continue to trail stops below the low average to protect profits. British Pound Futures Quotes + Charts
The strong up trend in the December Canadian continues. The Canadian rallied through resistance near .8200 and .8400 exceeding .8500 last week. Stay long the Canadian Dollar, with a longer-term objective of .8700 and trail stops below the low average to protect profits. Canadian Dollar Futures Quotes + Charts
The Crude Oil is at a crossroads. The recent up trend was broken but the market managed to maintain closes above key support near 46.00. January Crude rallied back to resistance near the trend average last week and made a stab above, but quickly rejected the 50.00 level (A). With the Momentum indicator negative and prices below the trend average, the trend is down. This changes if the Crude can close above 49.80. If it closes below key support near 46.00 this would indicate a larger down trend with an objective of 39.00. Crude Oil Futures Quotes + Charts
The January Heating Oil is the strongest of the Energy group, but is still in a neutral position. After falling to a Fibonacci retracement (61.8%) it rallied back above the trend average, however the Momentum indicator has remained negative and the market found resistance near 1.5000. Look for the market to find some direction by either closing above 1.500 or below the trend average around 1.4280 before taking a position. Heating Oil Futures Quotes + Charts
The January Unleaded is also neutral. It was trading back up around the trend average last week after having found support near 1.2200. With the Momentum indicator negative, sell short if the market maintains closes below the trend average. Unleaded Gasoline Futures Quotes + Charts
The up trending channel has been broken, and Momentum has been trending lower since mid September (A). The March Bond has been trading around the trend average and found resistance at the lower channel line (B). The market may be forming a "head and shoulders" top formation (LS = left shoulder, H = head, RS = right shoulder). This pattern would be confirmed by a close below the neck line (C) and negated by breaking the shoulder line (D). Look for an objective of 106-26, a 50% retracement of the May/October rally, down to 106-12, which is a measured objective from the H&S pattern. Treasury Bond Futures Quotes + Charts
The March Note is weaker than the bond and has been trading below the trend average. The market broke but did not close below the neck line of an H&S pattern similar to that seen in the Bond. Remain short with a stop above 112-00. Objectives here would be 108-30 (50%), and 108-23.5 (H&S). Ten-Year Note Futures Quotes + Charts
The March 5yr has been in a down trend since early November. There is support at 108-21 on the way to an objective of 107-30 (50%). A move above the near term down trend line (109-20) would lead to a test of the trend average. Five-Year Note Futures Quotes + Charts
The March Eurodollar broke down from its sideways trading range below 97.35 and fell to a Fibonacci retracement (61.8%) of 97.12. A close below 97.08 would point to a test of key support near 96.85. Maintaining closes below 96.85 would indicate a longer term down trend with an eventual objective of 95.20. Eurodollar Futures Quotes + Charts
After failing twice to break out of its trading range to the up side (A, B), the March Wheat appears to have broken out to the down side, closing below its previous lows. This move points to an initial objective of 2.825 (C) with an outside chance of obtaining a further objective of 2.68 (D), all of which would be negated by a move back above 3.22. Wheat Futures Quotes + Charts
March Corn has been trading in a narrow range. The market failed to break out of the channel to the upside and has fallen back to the bottom of the recent range. Negative Momentum still favors the down side. Stay short March Corn with an initial objective of 1.96 and a smaller probability of reaching 1.80. Corn Futures Quotes + Charts
The January Beans fell as indicated in my last Fast Break, 11/02/04, but didn't reach the downside objective of 490. This is why I always recommend trailing a stop order to initially limit losses and, if the market moves enough, to eventually protect profits. The Beans found support at 5.10 and moved back to the trend average, eventually gapping higher above the average after the Momentum indicator had turned positive, which turned the trend up. Momentum has flattened out as the market finds resistance near 5.60. Support is at 5.42 and 5.35. Continue to buy January Soybeans if support holds or if the trend resumes. Soybean Futures Quotes + Charts
December Cattle fell as indicated pulling up near 82.00 and not quite reaching the objective at 81.00. Generally when a market fails to meet an objective it is telling us something significant. Here, after the trend stalled, the Cattle gapped higher to test the trend average before correcting and breaking out to the up side last week. We are now tracking the February contract and see that it has been trading in a down sloping channel. The market rallied to the top of the range last week and peaked a bit above before closing the week just below. The Momentum indicator is positive and if Cattle can close above 90.00 it would measure an objective of 95.00. Live Cattle Futures Quotes + Charts
The January Feeder Cattle are considerably weaker than their slaughter ready cousins. The trend in Feeders is down below the trend average and Momentum remains negative also. However the new low in price last week was not accompanied by a new low for the Momentum indicator. Look for a continued correction or consolidation with resistance at 104.00 before the trend average around 105.50. Support is at 101.00 and 99.00. Feeder Cattle Futures Quotes + Charts
A down trend never developed in the December Hogs. Instead, Momentum turned positive and an up trend took the market to new contract highs. Now tracking the February contract, continue to stay long the market as it has nearly reached an objective of 76.20, trading as high as 75.85 last Friday. Continue to trail stops below the low average to protect profits. Lean Hog Futures Quotes + Charts
The Coffee did move away from the trend average but not to the down side as expected (A). Instead it rallied strongly higher and spiked up to new contract highs. This is another example of letting the market tell us what to do and not getting hung up having to be right about the direction ahead of time. As long as we position ourselves with the market, we have a chance to come out on the right side. The market has consolidated the sharp gains and held above support. Objectives for this up move come in at 107.00, 108.00, and 109.00 (B). Support is at 90.00 and 87.50. Coffee Futures Quotes + Charts
The down trend in March Sugar was short lived and did not meet the 825 objective. The market regained the trend average and now it appears the trend has turned back up. Remain long; perhaps it will finally meet the 9.50 objective that was missed last time up. Closing back below the trend average at 8.79 would put the scheme in doubt again. Sugar Futures Quotes + Charts
Cocoa broke out to the up side and produced a strong rally. The large key reversal signaled the end of the move and a subsequent gap down left an "island" top formation on the chart. The market continued to break and finally found support near the Fibonacci retracement (61.8%) of the October/November up move around 1560. As that support holds, buy the March Cocoa and look for a retest of the gap up at 1660. Cocoa Futures Quotes + Charts
PLEASE NOTE THAT THERE IS AN INHERENT RISK OF LOSS ASSOCIATED WITH OPTION CONTRACTS. OPTIONS TRADING IS NOT SUITABLE FOR ALL INVESTORS. OPTIONS CAN AND DO EXPIRE WORTHLESS. IF YOU PURCHASE A COMMODITY OPTION, YOU MAY SUSTAIN A TOTAL LOSS OF THE PREMIMUM AND OF ALL TRANSACTION COSTS.