Crude Oil Bulls Attempt to Gain The Momentum Trading Above The 10 Day Moving Average

Crude oil was higher overnight as it extends this week's short covering rally above the 10 day moving average. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

Closes above the 20 day moving average crossing at 74.33 are needed to confirm that a short term low has been posted. If January resumes the decline off October's high, the 87% retracement level of this fall's rally crossing at 68.16 is the next downside target.

Friday's pivot point, our line in the sand is 72.33

First resistance is the overnight high crossing at 74.29
Second resistance is the 20 day moving average crossing at 74.33

First support is the 10 day moving average crossing at 71.74
Second support is Monday's low crossing at 68.59

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Natural gas was higher overnight and is extending this month's rally above the 75% retracement level of the October-December decline crossing at 5.807. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near term.

If January extends this month's rally, the 87% retracement level of the October-December decline crossing at 6.036 is the next upside target. Closes below the 20 day moving average crossing at 5.065 would temper the near term bullish outlook in the market.

Natural gas pivot point for Friday is 5.711

First resistance is the overnight high crossing at 5.920
Second resistance is the 87% retracement level of the October-December decline crossing at 6.036

First support is the 10 day moving average crossing at 5.344
Second support is the 20 day moving average crossing at 5.065

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The U.S. Dollar was lower due to profit taking overnight as it consolidates some of this month's rally. Stochastics and the RSI are overbought but remain neutral signaling that additional gains are possible near term.

If March extends this month's rally, the 38% retracement level of the 2008-2009 decline crossing at 79.72 is the next upside target. Closes below the 20 day moving average crossing at 76.13 would confirm that a short term top has been posted.

First resistance is Monday's high crossing at 78.28
Second resistance is the 38% retracement level of the 2008-2009 decline crossing at 79.72

First support is the 10 day moving average crossing at 76.99
Second support is the 20 day moving average crossing at 76.13



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Crude Oil and Natural Gas Technical Outlook For Friday Morning

Nymex Crude Oil (CL)

Crude oil's rebound extends further and further rise could still be seen as long as 71.21 minor support holds. Nevertheless, we'd still expect upside to be limited by 61.8% retracement at 76.87 and bring resumption of the fall from 82.0. On the downside, below 71.21 will indicate that recovery from 68.58 has completed and will flip intraday bias for this support first. Break will target 65.05 key support next.

In the bigger picture, we're favoring the case that medium term rise from 33.2 has completed at 82.0 with bearish divergence condition in daily MACD. The break of medium term trend line support last week affirms this case and should pave the way to 58.32 cluster support (50% retracement of 33.2 to 82 at 57.60) for confirmation. As noted before, rise from 33.2 is treated as part of the correction pattern that started at 147.27. Firmed break of 58.32 support will argue that the down trend from 147.27 might be resuming for another low below 33.2. On the upside, break of 79.04 resistance is needed to invalidate this view, otherwise, outlook will remain bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

Nymex Natural Gas (NG)

Natural gas rises further to as high as 5.926 so far and at this point, intraday bias remains on the upside for 61.8% projection of 2.409 to 5.318 from 4.157 at 5.955. Break will target 38.2% retracement of 13.694 to 2.409 at 6.72 next. On the downside, below 5.57 minor support will suggest that an intraday top is formed and bring consolidations. But downside should be contained well above 4.837 support and bring rally resumption.

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 resumes as expected after consolidations from 5.318 completed. Current rally should now be targeting 38.2% retracement of 13.694 to 2.409 at 6.72 and beyond. Break of 4.432 support is needed to indicate that natural gas has topped. Otherwise, outlook will remain bullish.....Nymex Natural Gas Continuous Contract 4 Hours Chart.


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New Video: It’s Official Silly Season for Gold

We are already in the “silly season” and what we mean by that is after December 15 most traders are not serious about the markets and they’re not committed to any large positions for the balance of the year.

We’ve had a number requests to do a video on gold, so here it is. As you will see in the video, gold has fallen back to an area that should provide support, however it will remain choppy and thinly traded for the balance of the year.

We strongly recommend that if you’re not in gold, to wait until we see more interest and activity coming into 2010.

Just click here to watch the new video and as always our videos are free to watch and there is no need to register. Please take a minute to leave a comment and let us know where you think Gold is headed.

Good trading,

Ray C. Parrish
President/CEO
The Crude Oil Trader

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Where is Crude Oil Headed on Friday?

CNBC's Sharon Epperson discusses the day's activity in the commodities markets, and looks ahead to where oil is likely headed tomorrow.





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Crude Oil Gains Limited By Stronger U.S. Dollar

Crude oil closed steady at $72.66 a barrel today. Prices closed nearer the session high today. Gains were limited by a stronger U.S. dollar and weaker U.S. stock indexes. Crude prices are still in a two month old downtrend on the daily bar chart. The next downside price objective for the crude oil bears is to produce a close below solid technical support at this week's low of $68.59.

Natural gas closed up 30.5 cents at $5.767 today. Prices closed nearer the session high today and hit another fresh six week high. A bullish weekly storage report boosted nat gas today, along with recent cold U.S. weather and more in the forecast. Bulls have gained solid upside near term technical momentum recently. Prices are in a steep two week old uptrend on the daily bar chart.

Unleaded gasoline (RBOB) closed down 225 points at $1.8514 today. Prices closed near mid range today. Bears still have the near term technical advantage. The next upside price objective for the bulls is closing prices above solid technical resistance at $1.9500.

The U.S. Dollar index closed up 76 points at 78.10 today. Prices closed near the session high and hit a fresh three month high today. The bulls have recently gained good upside near term technical momentum to suggest that a near term low is in place.

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Has the dollar bottomed out?

We have made a number of videos on the dollar index and in our latest video we show you some of the aspects we outlined in our previous video that have come to pass.

The positive divergences on the MACD indicator which we discussed last time have kicked in and pushed the dollar index higher. Longer term major trend for the dollar index continues to be negative. In this short video you’ll see what the market is doing now and what we expect it to do in the future.

Just click here to watch the video and as always our videos are free to watch and there is no need to register. Please take a minute to leave a comment and let us know what you think of the video and the direction of the dollar.

Good trading,

Ray C. Parrish
President/CEO Crude Oil Trader


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Crude Oil Falls as Dollar Reaches Three Month High Against Euro

Crude oil fell for the first time in three days as the dollar strengthened against the euro, limiting the appeal of commodities as an alternative investment. Oil dropped as much as 2 percent as the dollar rose to a three month high against the European currency and U.S. equities declined. Futures are 12 percent below the year’s high of $82 a barrel reached Oct. 21. U.S. oil supplies are 6.4 percent above the five year average, the Energy Department said yesterday.

“The dollar’s stronger, and that’s for the most part the big thing here,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. Crude oil for January delivery fell 70 cents, or 1 percent, to $71.96 a barrel at 1:50 p.m. on the New York Mercantile Exchange. Earlier, futures touched $71.21 a barrel. Oil has risen 61 percent this year. The dollar strengthened to $1.4329 per euro at 1:51 p.m. in New York from $1.4531 yesterday. Earlier it touched $1.4305, the highest since Sept. 7......Read the entire article.

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Crude Oil: Lower Levels Ahead?

The crude oil market continues to soften and is now close to some important levels that we think we should look at. In our new video we look at what is happening in this market right now and what we expect to happen in the future.

As we have indicated in our earlier posts, we are now in the official “silly season” for trading. What we mean by that is the markets will be very thin, choppy and can be moved by a relatively small amount of money.

Just click here to watch the new video and as always our videos are free to watch and there is no need to register. Please feel free to leave a comment and let us know what you are thinking about the direction of crude oil.


Good trading,

Ray C. Parrish
President/CEO Crude Oil Trader


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Crude Oil Falls on Overnight Rally in the U.S. Dollar

Crude oil was lower overnight as it consolidates some of this week's short covering rally but remains above the 10 day moving average crossing at 71.80. Stochastics and the RSI are turning bullish hinting that a short term low might be in or is near.

Closes above the 20 day moving average crossing at 74.49 are needed to confirm that a short term low has been posted. If January resumes the decline off October's high, the 87% retracement level of this fall's rally crossing at 68.16 is the next downside target.

Thursday's pivot point, our line in the sand is 72.27

First resistance is Wednesday's high crossing at 73.55
Second resistance is the 20 day moving average crossing at 74.49

First support is Monday's low crossing at 68.59
Second support is the 87% retracement level of this fall's rally crossing at 68.16

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Natural gas was higher overnight and is challenging the 62% retracement level of the October-December decline crossing at 5.565. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near term.

If January extends this month's rally, the 75% retracement level of the October-December decline crossing at 5.807 is the next upside target. Closes below the 20 day moving average crossing at 4.993 would temper the near term bullish outlook in the market.

Natural gas pivot point for Thursday is 5.484

First resistance is Wednesday's high crossing at 5.569
Second resistance is the 75% retracement level of the October-December decline crossing at 5.807

First support is the 10 day moving average crossing at 5.188
Second support is the 20 day moving average crossing at 4.993

Today’s Stock Market Club Trading Triangles

The U.S. Dollar was sharply higher overnight as it extends this month's rally. Stochastics and the RSI are overbought but remain neutral signaling that additional gains are possible near term.

If March extends this month's rally, the 38% retracement level of the 2008-2009 decline crossing at 79.72 is the next upside target. Closes below the 20 day moving average crossing at 76.03 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 78.16.
Second resistance is the 38% retracement level of the 2008-2009 decline crossing at 79.72.

First support is the 10 day moving average crossing at 76.82.
Second support is the 20 day moving average crossing at 76.03.

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Crude Oil and Natural Gas Technical Outlook For Thursday Morning

Nymex Crude Oil (CL)

Crude oil's recovery from 68.58 might still be in progress for 38.2% retracement of 82.0 to 68.58 at 73.71 and possibly above. But after all, we'd expected upside to be limited by 61.8% retracement at 76.87 and bring fall resumption. Below 68.58 will target 65.05 key support next.

In the bigger picture, we're favoring the case that medium term rise from 33.2 has completed at 82.0 with bearish divergence condition in daily MACD. The break of medium term trend line support last week affirms this case and should pave the way to 58.32 cluster support (50% retracement of 33.2 to 82 at 57.60) for confirmation. As noted before, rise from 33.2 is treated as part of the correction pattern that started at 147.27. Firmed break of 58.32 support will argue that the down trend from 147.27 might be resuming for another low below 33.2. On the upside, break of 79.04 resistance is needed to invalidate this view, otherwise, outlook will remain bearish.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

Nymex Natural Gas (NG)

Intraday bias in Natural gas remains on the upside with 5.37 minor support intact and current rise is still expected to continue to 61.8% projection of 2.409 to 5.318 from 4.157 at 5.955 next. On the downside, below 5.37 minor support will turn intraday bias neutral and bring retreat, probably to 4 hours 55 EMA (now at 5.221). Nevertheless, downside should be contained above 4.837 support and bring rally resumption.

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 resumes as expected after consolidations from 5.318 completed. Current rally should now be targeting 38.2% retracement of 13.694 to 2.409 at 6.72 and beyond. Break of 4.432 support is needed to indicate that natural gas has topped. Otherwise, outlook will remain bullish.....Nymex Natural Gas Continuous Contract 4 Hours Chart.

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