Thursday, May 24, 2012

Has Crude Oil Found Support at 90.26? How Indicators Say......

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Crude Oil

Crude oil [July contract now] closed higher due to short covering on Thursday as it bounces off the 62% retracement level of the 2011-2012 rally crossing at 90.26. The mid range close sets the stage for a steady opening when Friday's night session begins. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If July extends this month's decline, the 75% retracement level of the 2011-2012 rally crossing at 85.69 is the next downside target. Closes above the 20 day moving average crossing at 97.19 are needed to confirm that a low has been posted. First resistance is the 10 day moving average crossing at 92.91. Second resistance is the 20 day moving average crossing at 97.19. First support is Wednesday's low crossing at 89.28. Second support is the 75% retracement level of the 2011-2012 rally crossing at 85.69.

Monthly Long Term Trend = Bearish
Weekly Intermediate Term Trend = Bearish
Daily Short Term Trend = Bearish

Natural Gas

Natural gas [still June contract] closed lower on Thursday as it extends this week's trading range. The low range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If June extends the rally off last week's low, February's high crossing at 3.040 is the next upside target. Closes below the 20 day moving average crossing at 2.474 would signal that a short term top has been posted. First resistance is last Friday's high crossing at 2.759. Second resistance is February's high crossing at 3.040. First support is the 10 day moving average crossing at 2.608. Second support is the 20 day moving average crossing at 2.474.

With a Trade Triangle Analysis Score of -90, this market is in a strong trend to the downside. Long term, intermediate term, and short term traders are in short positions in crude oil with appropriate money management stops.

GOLD

Gold closed higher [June contract] due to short covering on Thursday. The low range close sets the stage for a steady to lower opening when Friday's night session begins trading. Stochastics and the RSI are turning bearish signaling sideways to lower prices are possible near term. If June renews the decline off February's high, the 38% retracement level of the 2008-2011 rally crossing at 1487.50 is the next downside target. Closes above the 20 day moving average crossing at 1601.70 are needed to confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 1601.70. Second resistance is this month's high crossing at 1672.30. First support is last Wednesday's low crossing at 1526.70. Second support is the 38% retracement level of the 2008-2011 rally crossing at 1487.50.

With a Trade Triangle Analysis Score of -100, the gold market is in a strong downtrend. Long term, intermediate term, and short term traders are in short positions in gold with appropriate money management stops.

Monthly Long Term Trend = Bearish
Weekly Intermediate Term Trend = Bearish
Daily Short Term Trend = Bearish

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