Monday, January 10, 2011

Crude Oil Rebounding But is $90 Our New Resistance Level?

Crude oil is rebounding this morning but still trading below 90 dollar levels at the moment. Traders seem to be focusing on the minimal impact the shut down of the Alaskan pipeline system is having and appear to be more concerned about Chinas sharp trade surplus decline. Is the $90 level showing itself to be firm resistance today?

Crude oil was higher in Sunday evenings overnight session due to short covering as it consolidates some of last week's decline but remains below the 20 day moving average crossing at 89.82. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If February extends last week's decline, the reaction low crossing at 87.43 is the next downside target. Closes above the 10 day moving average crossing at 90.01 would temper the near term bearish outlook. First resistance is the 10 day moving average crossing at 90.01. Second resistance is last Monday's high crossing at 92.58. First support is last Friday's low crossing at 87.25. Second support is the reaction low crossing at 84.09. Crude oil pivot point for Monday is 88.98.

Natural gas was lower overnight as it extends last week's decline. Stochastics and the RSI have turned bearish signaling that sideways to lower prices are possible near term. Closes below the 20 day moving average crossing at 4.318 would confirm that a short term top has been posted. If February renews the rally off December's low, the 50% retracement level of the June-October decline crossing at 4.876 is the next upside target. First resistance is last Tuesday's high crossing at 4.707. Second resistance is the 50% retracement level of the June-October decline crossing at 4.876. First support is the 20 day moving average crossing at 4.318. Second support is December's low crossing at 3.985. Natural gas pivot point for Monday is 4.479.

Gold was slightly lower overnight as it extends last week's decline. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If February extends last week's decline, the reaction low crossing at 1331.10 is the next downside target. Closes above the 10 day moving average crossing at 1392.90 would confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 1392.90. Second resistance is last Monday's high crossing at 1424.40. First support is last Friday's low crossing at 1356.50. Second support is the reaction low crossing at 1331.10. Gold pivot point for Monday is 1372.00.


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