Crude Oil Falls Hard, Bears Continue to Hold the Near Term Advantage

Crude oil closed lower on Friday and below the 75% retracement level of this fall's rally crossing at 70.23 as it extended the decline off October's high. The low range close sets the stage for a steady to lower opening on Monday. If January extends the decline off October's high, the 87% retracement level of this fall's rally crossing at 68.16 is the next downside target. Closes above the 20 day moving average crossing at 76.05 are needed to confirm that a short term low has been posted. First resistance is the 10 day moving average crossing at 74.16. Second resistance is the 20 day moving average crossing at 76.05. First support is today's low crossing at 69.46. Second support is the 87% retracement level of this fall's rally crossing at 68.16.

Natural gas closed lower due to profit taking on Friday as it consolidated some of this week's rally. The low range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near term. If January extends this week's rally, the 62% retracement level of this fall's decline crossing at 5.565 is the next upside target. Closes below the 20 day moving average crossing at 4.866 would temper the near term friendly outlook in the market. First resistance is today's high crossing at 5.375. Second resistance is the 62% retracement level of this fall's decline crossing at 5.565. First support is the 20 day moving average crossing at 4.866. Second support is the 10 day moving average crossing at 4.859.

The U.S. Dollar closed sharply higher on Friday as it extended this week's rally. The high range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If March extends its current rally, November's high crossing at 77.27 is the next upside target. Closes below the 20 day moving average crossing at 75.68 would temper the near term friendly outlook in the Dollar. First resistance is today's high crossing at 77.12. Second resistance is November's high crossing at 77.27. First support is the 10 day moving average crossing at 75.89. Second support is the 20 day moving average crossing at 75.68.


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