Technical analysts look for patterns in price movements. The classic tool of searching the movement of the price, said tool is the moving average. Using this type of tool gives you a glimpse into the future of oil and gas prices. There are a number of technical indicators that show when and where price is likely to break out or break down.
Here's an example of how you can use this method. In recent times there have been several major oil companies down. They include Shell, E&P, Enron, and wells contractors like Halliburton. These companies have all been hurt by the global economy and now they must rely on massive amounts of crude oil imports to meet their production.
As the prices start to fluctuate oil supplies are threatened. In addition, these companies are all in the same sector. When you find the trend of the oil prices breaking out, then you can buy a call or put option on the stocks of each company involved. This will help you protect yourself against a complete wipeout.
Gold Price Eyes is also showing a new trend called the continuation cycle. This is based on the Dow Theory and works on the assumption that the price of oil is likely to continue on a downward path. The theory states that once a pattern of price activity develops in the lower price range of oil, it will continue on a downward path for at least two years. However, if and when it breaks out in the higher price range then the price will reverse its trend and head back up.
This can be good news for investors that want to take advantage of the break out because at the end of the period when it reverses, the prices will likely fall back down. The problem is that this is an assumption based on the fact that the market always reverts to a new higher peak and valley before making a recovery. If the scenario plays out exactly as predicted then the market will likely fall again. This is something investors do not want to happen.
Gold Price Eyes shows that there are many technical indicators that have highlighted the low prices over recent periods. However, they do not seem to indicate that the prices will continue on the current course. On the contrary, it seems to show that the current decline is temporary. However, it can also be interpreted that the market is expecting a short term correction which may occur in the next few days. The market may be moving towards a minor break above the resistance levels before the end of the week.
Oil supplies seem to be a major factor driving the price of Gold Price Eyes. As we know, tensions in the Middle East seem to have increased and supplies are now at record highs. In addition, there are rumors that Iran may cut back its purchases or even quit the program which increases demand. Oil prices have continued their steep fall and the pressure on the Gold Market continues. If these factors continue, the price of Gold will continue to drop. This may be good news for Gold Investors.