Friday, June 8, 2012

Bullish Signals Creeping in to the Crude Oil Market

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Crude oil closed lower on Friday but remains above the 87% retracement level of the 2011-2012 rally crossing at 81.36. The high range close sets the stage for a steady to higher opening when Sunday's evening session begins. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 89.54 are needed to confirm that a low has been posted. If July renews this spring's decline, last October's low crossing at 77.05 is the next downside target. First resistance is the 10 day moving average crossing at 86.17. Second resistance is the 20 day moving average crossing at 89.54. First support is Monday's low crossing at 81.21. Second support is last October's low crossing at 77.05.

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Natural gas closed higher on Friday as it consolidated some of the decline off May's high. The high range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are oversold and are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 2.547 are needed to confirm that a short term low has been posted. If July renews the aforementioned decline, the reaction low crossing at 2.166 is the next downside target. First resistance is the 20 day moving average crossing at 2.547. Second resistance is the reaction high crossing at 2.838. First support is today's low crossing at 2.231. Second support is April's low crossing at 2.096.


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Gold closed higher due to short covering on Friday as it consolidates some of Thursday's decline. The high range close sets the stage for a steady to higher opening when Sunday's evening session begins trading. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short term top might be in or is near. If August renews the decline off February's high, the 75% retracement level of the 2010-2011 rally crossing at 1461.30 is the next downside target. If August extends the rally off May's low, April's high crossing at 1674.30 is the next upside target. First resistance is last Friday's high crossing at 1632.00. Second resistance is April's high crossing at 1674.30. First support is the 20 day moving average crossing at 1580.90. Second support is May's low crossing at 1529.30.

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