Tuesday, September 27, 2011

Don't Be Fooled By This Rally, Crude Oil Bears Maintain The Advantage

The crude oil market has been finding support around the $78 a barrel level. Today’s move to the upside helped alleviate some of the oversold condition that this market was experiencing. The rally triggered our short term Trade Triangle into a positive mode.

This was not enough based on both our long term monthly and intermediate term weekly Trade Triangles which remain in the negative column. As you may recall we are tying the crude oil market with the equity markets. As the equity markets go, so does crude oil at the moment. Intermediate and Long term traders should continue to be short the crude oil market.

November crude oil closed up $4.18 a barrel at $84.42 today. Prices closed near the session high today. A rallying U.S. stock market and weaker U.S. dollar index boosted crude today. The crude bulls did gain fresh upside near term technical momentum today. A bullish double bottom reversal pattern may be forming on the daily bar chart.

Monthly Trade Triangles for Long Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short Term Trends = Positive
Combined Strength of Trend Score = – 75

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