Low Range Close in Oil Sets The Stage For Weak Open on Monday

Crude oil closed lower on Friday as it extends this week's decline. 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 75% retracement level of this fall's rally crossing at 70.23 is the next downside target. Closes above the reaction high crossing at 79.92 would confirm that a short term low has been posted.

First resistance is the 10 day moving average crossing at 76.95
Second resistance is the 20 day moving average crossing at 77.96

First support is last Friday's low crossing at 72.39
Second support is the 75% retracement level of this fall's rally crossing at 70.23

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Natural gas closed higher due to short covering on Friday as it consolidated some of this fall's decline. The mid range close sets the stage for a steady opening on Monday. Stochastics and the RSI remains bearish signaling that sideways to lower prices are possible near term.

If January extends this week's decline, weekly support crossing at 4.157 is the next downside target. Closes above the 20 day moving average crossing at 4.821 would temper the near term bearish outlook in the market.

First resistance is the 10 day moving average crossing at 4.785
Second resistance is the 20 day moving average crossing at 4.821

First support is Thursday's low crossing at 4.432
Second support is weekly support crossing at 4.157

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The U.S. Dollar closed sharply higher on Friday and above the reaction high crossing at 76.03 thereby confirming that a short term low has been posted. The high range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near term.

If March extends this week's rally, the reaction high crossing at 76.50 is the next upside target. If March renews this year's decline, weekly support crossing at 73.39 is the next downside target.

First resistance is today's high crossing at 76.33
Second resistance is the reaction high crossing at 76.50

First support is the 20 day moving average crossing at 75.46
Second support is last Wednesday's low crossing at 74.21

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