Sunday, August 12, 2012

ONG: Crude Oil Weekly Technical Outlook For Sunday August 12th

As always we like to check in with the great staff at Oil N'Gold for their call on where crude oil is headed this week.....

Crude oil resumed the rally from 77.28 by taking out 92.94 and reached as high as 94.72 before making a temporary top there. Initial bias is neutral this week for some consolidations. But we'll stay bullish as long as 86.92 support holds. As noted before, decline from 110.55 should have finished at 77.28 already. Current rebound from there should extend and above 94.72 will target 61.8% retracement of 110.55 to 77.28 at 97.84 and above.

In the bigger picture, price actions from 114.84 are viewed as a three wave consolidation pattern with fall from 110.55 as the third leg. Such decline could have finished earlier than we expected at 77.28. Sustained trading above 90 psychological level will bring stronger rally towards 114.83 resistance level. And break there will resumption whole up trend from 33.2. On the downside, another fall cannot be ruled out yet. But even in that case, strong support should be seen below 74.95 and above 61.8% retracement of 33.20 to 114.83 at 64.38 and bring another medium term rise.

In the long term picture, crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2. The corrective structure of the rise from 33.2 indicates that it's second wave of the consolidation pattern. While it could make another high above 114.83, we'd anticipate strong resistance ahead of 147.24 to bring reversal for the third leg of the consolidation pattern.

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