Crude Oil Market Summary and Trend Analysis For Tuesday November 22nd

We are now tracking the January contract. No change in our commentary from yesterday. As mentioned last week, we felt that the crude oil market was topping out. In retrospect, we have confirmation that is indeed the case. We are now expecting and look for support to come in at $94.55 (basis the January contract), which is a 61.8% Fibonacci retracement.

At the present time, both our monthly and weekly Trade Triangles remain in a positive mode, which is the direction of the major long term trend. Resistance is the $100 level. Long term, Intermediate term should be long this market with appropriate money management stops.

Monthly Trade Triangles for Long Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short Term Trends = Negative

Combined Strength of Trend Score = +85

Crude Oil Market Commentary For Tuesday Evening

Crude oil closed higher due to short covering on Tuesday as it consolidated some of the decline off last Friday's high. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. If May extends Monday's decline, the reaction low crossing at 77.44 is the next downside target. If May renews the rally off February's low, January's high crossing at 85.43 is the next upside target. First resistance is today's high crossing at 82.32. Second resistance is January's high crossing at 85.43. First support is Monday's low crossing at 80.89. Second support is the reaction low crossing at 77.44.

Natural gas closed lower on Tuesday as it extends this winter's decline. The low range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If May extends this winter's decline, weekly support crossing at 4.157 is the next downside target. Closes above the 20 day moving average crossing at 4.777 are needed to confirm that a low has been posted. First resistance is the 10 day moving average crossing at 4.578. Second resistance is the 20 day moving average crossing at 4.777. First support is today's low crossing at 4.400. Second support is weekly support crossing at 4.157.

The U.S. Dollar closed lower on Tuesday and is challenging the lower boundary of the trading range of the past six weeks, which crosses at 79.92. The mid range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near term. Closes below the reaction low crossing at 79.92 are needed to confirm a downside breakout of the aforementioned trading range and would open the door for a larger degree decline into spring. If June renews this winter's rally, weekly resistance crossing at 81.97 is the next upside target. First resistance is the reaction high crossing at 81.70. Second resistance is weekly resistance crossing at 81.97. First support is the reaction low crossing at 79.92. Second support is today's low crossing at 79.85.

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Crude Oil Lower Overnight, Due For Consolidation Day

Crude oil was lower overnight and spiked below the 38% retracement level of the February-June rally crossing at 62.25. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term.

If August extends the decline off last week's high, the 50% retracement level of the February-June rally crossing at 58.58 is the next downside target. Closes above the 20 day moving average crossing at 68.98 are needed to confirm that a short term low has been posted.

Wednesday's pivot point, our line in the sand is 63.12

First resistance is the 10 day moving average crossing at 67.19
Second resistance is the 20 day moving average crossing at 68.98

First support is the overnight low crossing at 61.87
Second support is the 50% retracement level crossing at 58.58

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