Monday, August 29, 2011

Crude Oil Bulls Take Charge in Mondays Early Trading

Crude oil bulls gained solid momentum Monday morning as oil traded slightly higher in Sunday evenings trading as it extends last week's short covering rally. Bulls extended the run on Monday morning after a report that showed U.S. consumer spending climbed more than forecast in July. Stochastics and the RSI remain neutral to bullish for the near term but we remain bearish overall as long as the bulls do not make a significant breach of the 89 dollar level.

Closes above the reaction high crossing at 89.19 are needed to confirm that a short term low has been posted. If October renews the decline off May's high, the 75% retracement level of the 2009-2011 rally crossing at 71.73 is the next downside target.

First resistance is the 20 day moving average crossing at 85.80.
Second resistance is the reaction high crossing at 89.19.

Crude oil's pivot point for Monday trading is 84.65.

First support is the reaction low crossing at 79.38.
Second support is this month's low crossing at 76.15.

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