Wednesday, August 25, 2010

Natural Retesting .618 Retrace

The spot month rallied from 2.40 to 6.11, in the 4th Qtr. of last year. In Mar. it retraced .618 of that move up exactly at the 3.82 lows.
It is now  retesting that level as the Sep contract makes new lows.     See any of the previous posts.    


    
Note how different this looks from the daily spot continuation chart;

There is a good chance that the spot chart will eventually also make new lows and take out the .618 , 3.82 level. The neckline break above targets 3.35 and there is a  Fibonacci .76 retrace at 3.28.

click to enlarge

It may very well may consolidate ahead of taking that level out, or better yet, just barely take it out then bounce .

VERY short term it's looking a little overdone here.


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