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Crude Oil Price Today – February 25th 2009

Daily Candle Chart - WTI Oil Prices 25th February 2009

Crude oil prices moved higher yesterday gaining $1.63 for the day with 9 and 40 day moving averages providing good support and resistance respectively. In an almost mirror image oil gained what it actually gave back a day before, but we notice that overnight the 9 and 14 day MA have crossed each other as if reluctantly trying to give a signal. More confirmation is needed so until then it’s rather sideways.

The short term trend is sideways while the medium and long term trends are bearish.

WTI:

Support:    $37.71 (yesterday’s low)                              Resistance: $41.78 (high of 10/02/08)

Support:    $37.53 (low of 20/02/09)                              Resistance: $41.50 (high of 23/02/09)

Support:    $36.63 (low of 16/02/09)                              Resistance: $40.41 (40 day moving average)

OIL (BRENT):

Support:    $40.43 (yesterday’s low)                               Resistance: $44.00 (high of 17/02/09)

Support:    $38.58 (low of 30/12/08)                               Resistance: $43.44 (14 day moving average)

Support:    $36.20 (low of 24/12/08)                               Resistance: $42.60 (yesterday’s high)

Summary:

As the correlation between equities movements and crude oil prices remains tight it was no surprise to see a rally in the oil markets from a rebound in the Dow. The move was actually a result of comments by Federal Reserves Chairman Ben Bernanke forecasting that the US recession could end in 2009 with a possible recovery in 2010. On the short term although further OPEC cuts are drawing some media attention encouraging bulls, the floating crude storages ( otherwise known as supertankers!) capable of being quickly released provide a counterbalance. to this view. Today’s EIA stats could give an indication of who’s got the upper hand, with analysts  currently looking for a build of 300,000 barrels in crude, a draw of 100,000 barrels in unleaded, and a draw of 1.4 million barrels in distillates.