Crude oil’s rise beyond the one year high reached today may be checked by a resistance level first encountered three years ago, according to technical analysis by consultants Petromatrix GmbH. Crude climbed to $75.15 a barrel in New York today, its highest price since last October. The rally may dissipate as it approaches $78.40, the highest price reached in 2006, the energy consultant said. The likelihood of crude breaking this threshold will be determined by movements in the U.S. dollar, it added.
“This stands out as the next resistance level,” Petromatrix Managing Director Olivier Jakob said in an interview from Zug, Switzerland. “It was the high in 2006, and also strong resistance in 2007. When it was broken in 2007, crude moved to the next level, which was $100.” Oil rose to a then record of $78.40 a barrel on July 14, 2006 as conflict between Israel and Hezbollah stoked concern Middle East crude exports might be disrupted. In 2007, seven months of price gains snapped after oil reached $78.77 on Aug. 1, and the commodity lost about $9 during the rest of that month before resuming its upward path.....read the entire article.
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