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Daily Oil Prices – Oil Price Chart 19th May 2009

WTI Oil Price Chart - Daily Oil Prices 19th May 2009

Yesterday’s rally in crude oil prices which saw the daily oil price gain 5% and closed the day at $59.69, a $2.62 gain on the day, was the result of a variety of factors.  First on a day largely bereft of any meaningful fundamental news on the economic calendar, the equity markets responded by assuming that no news was good news and therefore rose on sentiment only, pulling daily oil prices along in their wake.  Secondly further civil unrest in Nigeria also added some impetus to oil prices on fears of yet further oil supply problems from this part of the world, and finally a weakening in the US dollar caused by investors deciding to throw risk aversion to the wind added to the bullish mix in the energy complex.   From a technical perspective yesterday’s wide spread up bar bounced neatly off the 14 day moving average and closed above the 9, providing a bullish reversal which has continued in early trading this morning, most notably with a gapped up opening or “rising window” pushing the price of oil over $60 a barrel once again.  Following the last 7 days of sideways consolidation between $57 a barrel and $59 a barrel, we may now be seeing a sustained break to the upside for daily oil prices, and our initial target is now $62.45 which, if achieved, could open the way to a move back to $65 and beyond.

The short term trend is bullish, the medium term trend is sideways and the long term trend is bullish.

WTI:

Support:    $56.85 (yesterday’s low)                              Resistance: $60.86 (high of 12/05/09)

Support:    $55.13 (low of 06/05/09)                              Resistance: $60.70 (high of 13/05/09)

Support:    $54.56 (low of 26/03/09)                              Resistance: $59.92 (yesterday’s high)

OIL (BRENT):

Support:    $55.91 (yesterday’s low)                              Resistance: $59.43 (high of 07/11/08)

Support:    $55.43 (low of 07/05/09)                              Resistance: $59.05 (high of 13/05/09)

Support:    $53.86 (low of 06/05/09)                              Resistance: $58.86 (yesterday’s high)