Crude Oil Chart 2 Dec 2009
The weakness indicated on Tuesday with the extended shadow to the upper body of the candle, was duly confirmed yesterday, with oil prices taking up the pattern of a long slow slide lower, ending the oil trading session with a wide spread down candle which once again closed below all three moving averages. In addition the candle also left us with a double signal of a bearish engulfing candle, along with an “outside day’s” trading, suggesting that bearish sentiment is beginning to take hold once again in the short term. The break below the moving averages is less significant given the sideways price action of the last few months, and, as a reslt, the impact of these indicators is therefore significantly reduced at present. However, with the series of lower highs now clearly defined in the daily oil chart since the attempted break higher in mid October, this is a worrying sign for oil bulls, but with the deep and developed potential support region now below, any deeper move will require significant momentum to penetrate or breach the $68 to $74 per barrel price range. In the meantime, with the series of lower highs, coupled with yesterday’s signals, we can expect to see daily oil prices slide further in the short term, and a break below the current intermediate support at the $76 per barrel price level would indicate that a retest of the $74 per barrel level is imminent. Overall WTI closed at 76.60 having opened at 77.90 and traded between a high of 78.59 and low of 76.22. Brent closed its session at 77.88 having opened at 79.34 and traded between a high of 79.67 and low of 77.48 Oil futures traded 322k+ & 146k+ respectively.
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Support & Resistance for WTI
S1: 75.68 R1: 78.05
S2: 74.76 R2: 79.50
S3: 73.31 R3: 80.42
Support & Resistance for Brent
S1: 77.01 R1: 79.20
S2: 76.15 R2: 80.53
S3: 74.82 R3: 81.39
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