Market Rally Takes Crude Oil Along For The Ride

July crude oil closed higher on Monday and tested the 25% retracement level of the 2008-2009 decline crossing at 68.49 as it extends this spring's rally. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term.

Tread lightly here, this is no place or time to open full long positions in crude. Commercials continue to add to their short positions as they take longs off the table to take profits.

If July extends the rally off April's low, the 38% retracement level of the 2008-2009 decline crossing at 82.38 is the next upside target. Closes below the 20 day moving average crossing at 60.58 would confirm that a short term top has been posted.

First resistance is today's high crossing at 68.68
Second resistance is the 38% retracement level crossing at 82.38

First support is the 10 day moving average crossing at 63.01
Second support is the 20-day moving average crossing at 60.58

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The June Dollar closed lower on Monday as it extended last Friday's decline below the 62% retracement level of the 2008-2009 rally crossing at 79.80. A short covering rally tempered early losses and the mid range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are oversold, diverging but are neutral signaling that sideways to lower prices are possible near term.

If June extends this spring's decline, the 75% retracement level of the 2008-2009 rally crossing at 77.55 is the next downside target. Multiple closes above the 20 day moving average crossing at 81.74 are needed to confirm that a short term low has been posted.

First resistance is the 10 day moving average crossing at 80.37
Second resistance is the 20 day moving average crossing at 81.74

First support is today's low crossing at 78.62
Second support is the 75% retracement level crossing at 77.55

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The June S&P 500 index closed sharply higher on Monday and above May's high crossing at 929 thereby renewing the rally off March's low. The high range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

If June extends today's rally, the 38% retracement level of the 2008-2009 decline crossing at 1040.33 is the next upside target. Closes below the reaction low crossing at 875.40 would confirm that a top has been posted.

First resistance is today's high crossing at 947.00
Second resistance is the 38% retracement level crossing at 1040.33

First support is the 20 day moving average crossing at 904.17
Second support is the reaction low crossing at 875.40