Wednesday, August 24, 2011

Oil N Gold: Staying Bearish as Long as $89 Resistance Holds

Outlook in crude oil remains unchanged. We'll stay bearish as long as 89.00 resistance holds and expect deeper decline ahead. Below 79.17 will flip bias back to the downside for 75.71 first. Break will confirm resumption of whole fall from 114.83 and should target 70 psychological level next. On the upside, though, break of 89.00 resistance will dampen this bearish view and bring stronger rebound towards 100.62 resistance instead.

In the bigger picture, medium term rebound from 33.2 is treated as the second leg of consolidation pattern from 147.24 and should have finished at 114.83 already. Current decline should now target next key cluster support at 64.23 (61.8% retracement of 33.2 to 114.83 at 64.38). Sustained break will pave the way to retest 33.2 low. On the upside, break of 89.61 resistance is needed to be the first signal of bottoming or we'll stay bearish.

Posted courtesy of Oil N Gold.Com

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