Crude Oil Bears Take a Clear Near Term Advantage

Crude oil was higher due to short covering in overnight trading as it bounces off the 38% retracement level of the October-November rally crossing at 92.68. Stochastics and the RSI are oversold but remain bearish signaling that sideways to lower prices are possible near term.

If January extends this week's decline, the 50% retracement level of the October-November rally crossing at 89.37 is the next downside target. Closes above the 20 day moving average crossing at 98.11 are needed confirm that a short term low has been posted.

First resistance is the 20 day moving average crossing at 98.11. Second resistance is last Tuesday's high crossing at 101.25. First support is the 38% retracement level of the October-November rally crossing at 92.68. Second support is the 50% retracement level of the October-November rally crossing at 89.37. Crude oil pivot point for Monday morning is 93.83.

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