Crude oil was lower overnight due to profit taking and a weaker Euro as it consolidates some of this spring's rally. Stochastics and the RSI are diverging but are neutral to bullish signaling that additional gains are possible.
Day traders may start the regular trading session neutral as they watch the SP 500 closely to see if it will continue trading at the bottom of it's current bullish channel or if we get a serious break out to the downside. If we trade sharply below the channel crude oil will be sure to follow.
If July extends this spring's rally, the 38% retracement of the 2008-2009 decline crossing at 82.38 is the next upside target. Closes below the 20 day moving average crossing at 66.38 are needed to confirm that a short term top has been posted.
Monday's pivot point for crude oil is 71.82. Below that we are bearish, above the pivot we will play the bullish side.
First resistance is last Thursday's high crossing at 73.23
Second resistance is the 38% retracement level crossing at 82.38
First support is the 10 day moving average crossing at 69.73
Second support is the 20 day moving average crossing at 66.38
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