Nymex Crude Oil (CL)
Crude oil finally broke 82.0 resistance to resume the medium term rally and stayed firm above this level. While some sideway trading might be seen in initially this week, outlook will remain bullish as long as 80.79 support holds. Recent rise from 68.59 is expected to resume sooner rather than later towards upper trend line resistance at 87/88 level. On the downside, break of 80.79 will argue that a short term top might be formed with bearish divergence condition in 4 hours MACD and deeper pull back could be seen before another rise.
In the bigger picture, the break of 82.0 resistance confirms that whole medium term rise from 33.2 has resumed. Nevertheless, there is no change in the view that it's a correction to fall from 147.27. Hence, we'd continue to look for reversal signal as crude oil approaches 50% retracement of 147.27 to 33.2 at 90.24, which is close to 90 psychological level. However, break of 68.59 support is still needed to confirm that rise from 33.2 has completed. Otherwise, outlook will be neutral at worst even in case of deep pull back.
In the long term picture, there is no change in the view that fall from 147.27 is part of the correction to the five wave sequence from 98 low of 10.65. While the rebound from 33.2 is strong and might continue, there is no solid evidence that suggest fall 147.27 is completed and we're still preferring the case that rebound from 33.2 is merely a corrective rise only. Having said that, strong resistance should be seen between 76.77/90.24 fibo resistance zone and bring reversal for another low below 33.2 before completing the whole correction from 147.27.....Read the entire article.
Nymex Natural Gas (NG)
Despite edging higher to 6.108, Natural gas failed to sustain gain there and fell sharply towards the end of the week. Break of the near term rising trend line argues that a short term top is formed with bearish divergence condition in 4 hours MACD. Initial bias is milldy on the downside this week for deeper pull back towards 38.2% retracement of 4.157 to 6.108 at 5.363 first. On the upside, while some recovery might be seen, break of 6.108 high is needed to confirm that medium term rise has resumed. Otherwise, we'd expect more consolidations with risk for another fall.
In the bigger picture, medium term fall from 13.69 is treated as part of the long term consolidation pattern that started at 15.78 back in 2005 and might have completed at 2.409 already. Rise from 2.409 is still in progress and should target 38.2% retracement of 13.694 to 2.409 at 6.72 and beyond. On the downside, break of 4.157 support is needed to indicate that medium term rise from 2.409 has completed. Otherwise, outlook is neutral at worst even in case of deep pullback.....Read the entire article.
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