Global Market Wrap: Australian Markets and Gold Advancing

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Global Market Wrap:

Australian Markets and Gold Advancing

Equity Futures: Dow +9.00. S&P +1.10. NASDAQ +2.00. Japanese Nikkei +20.00. German Dax +20.00

Markets in Asia were mixed in Asia with the Japanese Nikkei declining by 17 points. Meanwhile, the Australian S&P/ASX has advanced by almost the same amount, 16 points, during the overnight session. The technology sector was largely responsible for the declines seen on the Nikkei with Toshiba Corp dropping by 2.67 percent and Taiyo Yuden Co. has declined 2.25 percent.

During the overnight session there were only 2 medium level news items. Firstly, the trade balance in Japan has come in at 0.42T after analysts were expecting a 0.31T read. It was reported that exports declined at the slowest pace in the past 12 months in October. During September, overseas shipments were around 30 percent but during October that figure dropped to 23 percent. Also released was a minor report on completed construction work which has jumped higher, to 2.2 percent. This is off from the previous reading of 4.5 percent but better than analysts’ expectations of 0.1 percent.

Trade Plan of the Day: TheLFB Trade Plan is USD\/CAD, one of the six that are available to members on the major pairs each day, plus four Jpy based cross pairs, S&P futures, oil, gold, and the dollar index.

Gold was recently trading higher by a paltry $1.70 to $1,169.10. The precious metal is finding support along the 1160 area with resistance firmly at 1170.


TheLFB Charting: S&P Futures Elliott Wave view
4 Hour Chart Flows: Long Price Points: 1.4800, and 1.5000 Looking for: A move higher if 1.4800 holds

Momentum: The pair went into Neutral mode on 26th October and has struggled to find the momentum to create and hold a long trend. The sentiment is flowing from overbought to oversold in quick time and is following the global market open and close of Asian, European, and U.S. commercial markets. This is a tight trading range.

Elliott Wave: The EUR\/USD pair is still trapped between the 1.4800 support and 1.5000 resistance zone after the recent moves were unable to break through the psychological 1.5 level.  A break of this zone would put bullish targets in play somewhere around 1.5200, if traders can initially break and hold a daily chart close above the current 1.5062 yearly highs.

Overall, traders may look for bullish possibilities as long the market trades above the 1.4800 support zone, where the A), B), C) correction was recently completed.

TheLFB Charting: EUR\/USD Elliott Wave view
4 Hour Chart Flows: Long Price Points: 1200 Looking for: A Wave 5) top, (that just keeps moving higher)

Momentum: Gold bullion moved into another long momentum cycle on 3rd Nov, and easily held the long break of 1060 that came with it. The pull-backs are getting bought when they hit an oversold 4 hour chart sentiment read, every 4-5 days. The current oscillator reads are as overbought as we have seen in the entire move up from 950.00 to 1160.00. Therefore we will be looking for a reversal to support, and looking to bank existing rather than buy new at these levels. The 1180 and 1200 areas look to be potential reversal points, with 1130 and 1100 momentum and sentiment price points.

Elliott Wave: It seems that gold may be targeting the 1200 area, before the Long blue wave V completes a larger, and extended, blue wave 5).

Gold values are reflecting U.S. dollar weakness that have held in place over the last few months. Traders with a long dollar bias should wait on resistance to be hit on gold before looking for the Usd to easily trade higher again. As such, the 1200 resistance area could be the key for a reversal short on gold, and long on the dollar.