STOCKS RESUME DOWNTREND -- GOLD RISES $5.00 -- ANADARKO PETROLEUM BREAKS OUT-- SIEBEL BREAKS DOWN --- BROKERS AND SMALL CAPS BREAK SUPPORT -- NASDAQ NEARING 1900 LEVEL
GOLD TESTING FEBRUARY HIGH... With stocks and the dollar falling today, gold prices are up $5. Chart 1 shows that bullion is now challenging its mid-February peak near $418. Gold stocks are rising as well. Last week we showed the XAU Index climbing back over its 50-day mooving average. Gold bullion has done the same. Renewed international tensions are adding to the safe-haven appeal of gold assets. Commodity prices as a whole are rising today as well. One exception is crude oil which is trading lower. Crude has come within two dollars of its all-time high at $40.
Chart 1
ANADARKO PETROLEUM HITS 52-WEEK HIGH... Although oil stocks are correcting downward today, Anadarko Petroleum is going in the other direction. The daily chart shows the oil leader trying to break out on rising volume. Its weekly chart shows the stock rising to a 21-month high after recently achieving a major bullish breakout. The next objective is the 58 level.
Chart 2
Chart 3
SIEBEL BREAKS SUPPORT LINE... Siebel Systems is one the day's worst performers in a weak technology sector. The daily chart shows that stock trading well under its 200-day moving average. Its relative strength line peaked in early January and has been falling since then. The weekly bars in Chart 5 are also troubling. They show SEBL breaking a support line extending back to the fourth quarter of 2002.
Chart 4
Chart 5
BROKERS AND SMALL CAPS BREAK SUPPORT... Last week I pointed out that small cap indexes and the broker index were threatening chart support at their February low. In Monday morning trading, those supports are being broken. The Russell 2000 Small Cap Index and the AMEX Broker/Dealer Index are trading under their February lows. That means that the stock market correction is infecting those former leaders.
Chart 6
Chart 7
NASDAQ IS NEARING 1900... The Nasdaq continues to lead the market lower. I've talked about next support being along the December lows in the 1900-1887 zone. The 200-day moving average currently sits at 1886. It looks like the Nasdaq is headed for a test of that line. That will be an important test for the Nasdaq and the rest of the stock market.
Chart 8
