Goldman: Oil Will Get Expensive Now That The Tankers Are Done Hoarding It

Goldman's David Greely is making a near-term bullish case for oil. His optimism is driven by A) The strong U.S. ISM Manufacturing data we had two days back, B) the fact that renewed Nigerian violence threatens supply, and C) the reduction in overhang caused by oil hoarded at sea in tankers (floating storage).

While the relationship appears far from perfect, he argues that U.S. oil demand tends to track ISM Manufacturing Index readings:

Most interestingly for short-term traders, Falling floating storage implies a tighter market, since less supply is basically out there ready to be sold into the market.

David Greely @ Goldman: [emphasis added] The area where the improvement in near-term fundamentals has been most pronounced in recent weeks is in the amount of oil in floating storage. The use of tankers to store excess supplies of crude oil and gasoil over the past year has been emblematic of the weakness in supply demand fundamentals during the recession, and the unloading of these tankers has been broadly viewed as a necessary precursor to a cleanup over the overall oil market.

Consequently, reports that anywhere from 0 to 50 million barrels of the total oil in floating storage has been recently unloaded have suggested a potential turn around in oil market fundamentals.



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Crude Oil Higher on Better then Expected Unemployment Numbers, Short Covering

Crude oil was higher due to short covering overnight as it consolidates some of Thursday's decline. Stochastics and the RSI are diverging but are turning neutral to bearish signaling that sideways to lower prices are possible near term.

If March extends this week's decline, the 75% retracement level of the September-January rally crossing at 71.70 is the next downside target. Closes above the 20 day moving average crossing at 76.94 are needed to confirm that a short term low has been posted.

Crude oil pivot point, our line in the sand is 74.24

First resistance is the 10 day moving average crossing at 74.53
Second resistance is the 20 day moving average crossing at 76.94

First support is Thursday's low crossing at 72.42
Second support is the 75% retracement level of the September-January rally crossing at 71.70

The "Super Cycle" in Gold and How It Will Affect Your Pocketbook in 2010

Natural gas was higher due to short covering overnight as it consolidates above the 10 day moving average crossing at 5.378. Stochastics and the RSI remain neutral to bullish signaling that additional strength is possible near term.

Closes above the 20 day moving average crossing at 5.487 are needed to confirm that a short term low has been posted. If March renews the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target.

Friday's pivot point for natural gas is 5.381

First resistance is the 20 day moving average crossing at 5.487
Second resistance is Wednesday's high crossing at 5.558

First support is last Thursday's low crossing at 5.060
Second support is the 75% retracement level of the December-January rally crossing at 4.919

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The U.S. Dollar was higher overnight as it extends this week's rally above the 38% retracement level of the 2009 decline crossing at 79.71. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are possible near term.

If March extends this winter's rally, the 50% retracement level of the 2009 decline crossing at 81.32 is the next upside target. Closes below the 20 day moving average crossing at 78.45 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 80.59
Second resistance is the 50% retracement level of the 2009 decline crossing at 81.32

First support is the 10 day moving average crossing at 79.31
econd support is the 20 day moving average crossing at 78.45

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Crude Oil Daily Technical Outlook For Friday

Crude oil's rebound from 72.43 should have completed at 78.04 already and fall from 83.95 is resuming. Break of 72.43 low will target 68.59 support next. On the upside, above 74.50 will turn intraday bias neutral and bring recovery. But upside should be limited below 78.04 resistance and bring fall resumption.

In the bigger picture, current development revives the case that medium term rise from 33.2 has topped out at 83.95 on bearish divergence condition in daily MACD. Break of 68.59 will confirm this case and target 58.32 support next. On the upside, however, above 78.04 resistance will dampen this view and argue that the medium term rise might still be in progress. Nevertheless, even in case of another high above 83.95, we'd continue to look of reversal signal as crude oil approaches 50% retracement of 147.27 to 33.2 at 90.24, which is close to 90 psychological level.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

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Despite Sell Off in Oil, Bulls Maintain a Slight Near Term Advantage

Crude oil closed sharply lower on Thursday as a result of today's bearish jobs data, which leaves any economic recovery in question. The low range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bullish despite today's decline signaling that a low might be near.

Closes above the 20 day moving average crossing at 77.42 are needed to confirm that a short term low has been posted. If March renews the decline off January's high, the 75% retracement level of the September-January rally crossing at 71.70 is the next downside target.

Crude oil's pivot point for Thursday evening is 74.19

First resistance is the 20 day moving average crossing at 77.42
Second resistance is the 50% retracement level of January's decline crossing at 78.43

First support is today's low crossing at 72.42
Second support is the 75% retracement level of the September-January rally crossing at 71.71

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Natural gas closed slightly higher on Thursday as it consolidates above the 10 day moving average crossing at 5.407. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term.

Closes above the 20 day moving average crossing at 5.501 are needed to confirm that a low has been posted. If March renews the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target.

Thursday evenings pivot point for natural gas is 5.398

First resistance is the 20 day moving average crossing at 5.501
Second resistance is the reaction high crossing at 5.804

First support is last Thursday's low crossing at 5.060
Second support is the 75% retracement level of the December-January rally crossing at 4.919

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The U.S. Dollar closed higher on Thursday and above the 38% retracement level of the 2009-2010 decline crossing at 79.71. The high range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways prices are possible near term.

If March extends this winter's rally, the 50% retracement level of the 2009-2010 decline crossing at 81.32 is the next upside target. Closes below the 20 day moving average crossing at 78.32 would confirm that a short term top has been posted.

First resistance is today's high crossing at 80.13
Second resistance is the 50% retracement level of the 2009-2010 decline crossing at 81.32

First support is the 10 day moving average crossing at 79.12
Second support is the 20 day moving average crossing at 78.32

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Phil Flynn: Worms in Space

Yesterday the petroleum markets were all about trying to digest the weekly inventory reports. Refineries are running at the lowest level since the 1980’s if you exclude time when refineries were shut down for hurricanes and this shows that demand is lousy. Yet at the same time there are fears that we are finally getting down to a point where refiners have cut back enough to meet slowing demand. Despite this fascinating study of supply versus demand, we will get more into what really made the market pop and drop and that was a story from the AP that was released again by the AFP on the Dow Jones commodity wire.

A breaking oil market seemed to rally quickly after a headline crossed that said, “WHITE HOUSE: Reported rocket launch by Iran would be a provocative act.” Oh my gosh! Rocket launch! What was that, Get Me Out! Well that seemed to be the reaction or a higher buy got triggered but the story had come out earlier. The report did say that the White House reported a rocket launch by Iran would Be a "provocative act.", but the White House was still checking out reports of the launch. The Kavoshgar 3 (Explorer) rocket was launched Wednesday, Iranian state-owned Al-Alam television reported.....Read the entire article.

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Crude Oil Drops the Most in 6 Months as Stocks Tumble, Dollar Strengthens

Crude oil tumbled the most in six months as the dollar gained and a drop in stocks bolstered skepticism that the economic recovery will be sustained. Oil fell as much as 5.4 percent as the greenback climbed versus the euro, curbing the appeal of commodities as an alternate investment. The Standard & Poor’s 500 Index dropped after more Americans filed first time claims for unemployment insurance last week, raising concern that an improvement in the job market is stalling.

“Oil is down because of the dollar’s strength and the poor fortunes of the S&P, especially after the jobs report,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. “The whole commodity sector is looking weak today.” Crude oil for March delivery fell $3.83, or 5 percent, to $73.15 a barrel at 11:49 a.m. New York time. Oil declined as much as $4.12 to $72.86, and is heading for the biggest daily drop since July 29. Prices are up 81 percent from a year ago.

“Everything on the screen is red because of negative economic news,” said Chip Hodge, who oversees a $9 billion natural resource bond portfolio as senior managing director at MFC Global Investment Management in Boston. “Unless the economy rebounds, prices should move in one direction, south.” The dollar climbed to the highest level against the euro since May after European Central Bank President Jean-Claude Trichet said the economic outlook is subject to “uncertainty.”

The dollar traded at $1.3745 per euro, up from $1.3893 yesterday. It traded earlier at $1.3728, the highest level since May 21.

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Trends for Stocks & Commodities: Gold, Oil and Indexes

Stocks and metals have been on a steady rise this week. The US Dollar drifting lower has helped to add fuel to the oversold bounce in equities and metals we are seeing.

Stocks – NYSE 65 Minute Chart
Stocks have started to show signs of a possible reversal to the upside. So far this week we have seen the major indices form a higher high and as of today are stuck under the key resistance level shown on the chart below. The rally seen this week has been on light volume indicating there is not much strength behind it at this time.

If buying volume picks up and we see the NYSE break this resistance level then money should start to pour back into the market as the first set up of higher highs and lows will have formed and that is the definition of an up trend.



Gold – 24 Hour Trading Chart Using 8 Hour Bars
This chart allows us to look far enough back to see key support and resistance levels. Today we saw gold sell down with rising volume which is bearish.



Oil – 10 Hour Candle Chart
The Oil fund is currently in the same situation as gold. It had a nice rally/bounce which was expected from the rather large sell off over the past couple weeks.



US Dollar Index – 2 Hour Chart
This chart shows the dollar rally that triggered the recent sell off in gold & silver from Jan 25th to Jan 31st. So far in February, the dollar has drifted lower into a support level and bounced sharply on Wednesday. This is very bullish price action and points to higher dollar prices in the near future.



Stock & Commodity Trading Conclusion:
In short, stocks and metals rallied on light volume which is a sign of weakness. They are both stuck under a key resistance level and selling volume has started to pickup. To add more logs to the fire, the US Dollar appears to be picking up speed for another surge higher in the next couple days.

All of this leads me to believe this weeks rally is just a dead cat bounce and lower prices are just around the corner. But, because the 60 minute intraday charts have made a higher high, the down trend is now in question. When in doubt, just stay out. During possible tops or bottoms I find it best to stay clear of the market, even for day traders unless there are very strong price and volume surges occurring.

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Crude Oil Drops a Second Day on U.S. Inventory Gains, Stronger Dollar

Crude oil declined for a second day after a U.S. government report yesterday showed a bigger than forecast increase in inventories, while a stronger dollar dulled the appeal of commodities. The Energy Department reported that crude stockpiles rose by 2.32 million barrels last week, compared with an expected 400,000 barrel gain, as refineries operated at their lowest rate outside of a hurricane period since 1989. Supplies of distillate fuels such as heating oil declined less than forecast.

“Strong contraction in distillate demand, which belies the recovery in the U.S. suggested by the latest GDP and manufacturing data, is weighing on sentiment,” said Harry Tchilinguirian, head of commodity derivatives research at BNP Paribas SA in London. “It will be the second half of the year before oil breaks its range centered around $75 and sustainably rallies.” Crude oil for March delivery fell as much as 88 cents, or 1.1 percent, to $76.10 a barrel in electronic trading on the New York Mercantile Exchange. It was at $76.35 at 1:21 a.m. London time. Futures, which gained 78 percent in 2009, are down 3 percent so far this year.

Crude declined in tandem with European stock indexes. The Dow Jones Stoxx 600 Index slipped 0.9 percent to 247.21 as of 1:22 p.m. in London, erasing an earlier gain of 0.3 percent, led by losses among companies in Greece, Portugal and Spain.....Read the entire article.

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Crude Oil Pivot, Support and Resistance Numbers For Thursday Morning

Crude oil was lower overnight as it consolidates some of the rally off last week's low. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near term.

If March extends this week's rally, the 50% retracement level of January's decline crossing at 78.43 is the next upside targets. Closes below the 10 day moving average crossing at 74.96 would temper the near term friendly outlook.

Thursday's pivot point, our line in the sand is 77.18

First resistance is Wednesday's high crossing at 78.04
Second resistance is the 50% retracement level of January's decline crossing at 78.43

First support is the 10 day moving average crossing at 74.96
Second support is last Friday's low crossing at 72.43

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Natural gas was lower overnight as it consolidates some of the rebound off last week's low. Stochastics and the RSI remain bullish signaling that additional strength is possible near term.

Closes above the 20 day moving average crossing at 5.500 are needed to confirm that a short term low has been posted. If March renews the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target.

Natural gas pivot point for Thursday is 5.446

First resistance is the 20 day moving average crossing at 5.500
Second resistance is Wednesday's high crossing at 5.558

First support is last Thursday's low crossing at 5.060
Second support is the 75% retracement level of the December-January rally crossing at 4.919

Just click here for your FREE trend analysis of natural gas ETF UNG

The U.S. Dollar was higher overnight and is trading above the 38% retracement level of the 2009 decline crossing at 79.71. Stochastics and the RSI are overbought but are neutral to bullish signaling that sideways to higher prices are possible near term.

If March extends this winter's rally, the 50% retracement level of the 2009 decline crossing at 81.32 is the next upside target. Closes below the 20 day moving average crossing at 78.31 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 79.89
Second resistance is the 50% retracement level of the 2009 decline crossing at 81.32

First support is the 10 day moving average crossing at 79.09
Second support is the 20 day moving average crossing at 78.31

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Bulls Lose Some Momentum on Unexpected Oil Inventory Build

Crude oil closed lower on Wednesday as it consolidated some of this week's rally. The low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI have turned bullish signal that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 77.95 are needed to confirm that a short term low has been posted. If March renews the decline off January's high, the 75% retracement level of the September-January rally crossing at 71.70 is the next downside target. First resistance is the 20 day moving average crossing at 77.95. Second resistance is the 50% retracement level of January's decline crossing at 78.43. First support is the 10 day moving average crossing at 74.94. Second support is last Friday's low crossing at 72.43.

Natural gas closed lower on Wednesday as it consolidated some of this week's rally. The mid range close sets the stage for a steady opening on Thursday. 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 5.527 are needed to confirm that a low has been posted. If March renews the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target. First resistance is the 20 day moving average crossing at 5.527. Second resistance is the reaction high crossing at 5.804. First support is last Thursday's low crossing at 5.060. Second support is the 75% retracement level of the December-January rally crossing at 4.919.

The U.S. Dollar closed higher on Wednesday ending a two day correction off Monday's high. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways prices are possible near term. If March extends this winter's rally, the 50% retracement level of the 2009-2010 decline crossing at 81.32 is the next upside target. Closes below the 20 day moving average crossing at 78.22 would confirm that a short term top has been posted. First resistance is Monday's high crossing at 79.76. Second resistance is the 50% retracement level of the 2009-2010 decline crossing at 81.32. First support is the 10 day moving average crossing at 78.97. Second support is the 20 day moving average crossing at 78.22.

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Crude Oil Falls After Report Shows Bigger Than Forecast U.S. Supply Gain

Crude oil fell after an Energy Department report showed a bigger than forecast increase in stockpiles as refineries idled units and imports climbed. Supplies rose 2.32 million barrels to 329 million last week, the report showed. A 400,000 barrel gain was forecast, according to the median of 16 analyst responses in a Bloomberg news survey. Refineries operated at the lowest rate in more than a year as fuel demand lagged behind year earlier levels.

“The crude number was surprisingly large,” said Jason Schenker, president of Prestige Economics LLC, an Austin, Texas based energy consultant. Crude oil for March delivery fell 24 cents, or 0.3 percent, to $76.99 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Prices jumped as much as 81 cents and slipped 71 cents during the session. Oil traded at $77.17 a barrel before the release of the inventory report at 10:30 a.m. in Washington.

Gasoline inventories unexpectedly dropped 1.31 million barrels to 329 million, the report showed. Supplies were 2.3 percent higher than the five year average for the period, according to the department. Stockpiles were forecast to climb by 1.4 million barrels. “The fact that gasoline inventories were down in an environment where demand is so paltry shows that refiners are serious about reducing fuel stockpiles,” said John Kilduff, a partner at Round Earth Capital, a New York based hedge fund that focuses on food and energy commodities.....Read the entire article.

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Phil Flynn: You Have Got to Love that Groundhog

The Energy Report Wednesday February 3 2010

Maybe that ground hog is something special after all. Oil futures fly after the ground hog say his shadow and predicted 6 more weeks of winter. And by the way no I did not see my shadow and yes I heard that one before. Still oil joined the stock market in the biggest two day rebound in over three months. Oils sudden resurgence comes on the backs of some renewed economic optimism especially in the manufacturing sector but also because of some concerns about the disruption of supply.

RBOB Gasoline lead the rally gaining even more support from refineries that are closing on purpose and some that are not. Oh sure most of the move in oil seemed to be macro economically motivated but word that Valero Energy Corp. shut a fluid catalytic cracker at its Quebec City refinery after a fire sure helped gasoline lead the way. Bloomberg news said that the fire was reported at about 2 a.m. local time at pumps on the gasoline making cat cracker, Bill Day, a company spokesman, said in an e-mail. No injuries were reported. The blaze was extinguished at 4:40 a.m.

The 66,000 barrel a day cat cracker has been shut down and an estimate for the restart of the unit is pending a damage assessment, according to Day. The refinery has a capacity of 265,000 barrels a day, according to data compiled by Bloomberg.....Read the entire article.


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Crude Oil: Verge of Collapse?

Stephen Schork, editor of The Schork Report, and Bruce Lanni, of Nollenberger Capital Partners, share their energy outlooks.




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Crude Oil Moves Higher, Signals Turn Bullish

Crude oil was higher overnight as it extends the rally off last week's low. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible near term. Tuesday's close above the 10 day moving average crossing at 75.01 confirms that a short term low has been posted.

If March extends this week's rally, the 20 day moving average crossing at 77.90 then the 50% retracement level of January's decline crossing at 78.43 are the next upside targets.

Wednesday's pivot point for crude oil is 76.35

First resistance is the 20 day moving average crossing at 77.90
Second resistance is the overnight high crossing at 78.04

First support is the 10 day moving average crossing at 75.01
Second support is last Friday's low crossing at 72.43

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Natural gas was higher due to short covering overnight as it extends the rebound off last week's low crossing at 5.060. Stochastics and the RSI are oversold and are turning bullish signaling that additional short covering gains are possible near term.

Closes above the 20 day moving average crossing at 5.533 are needed to confirm that a short term low has been posted. If March renews the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target.

Natural gas pivot point for Wednesday is 5.457

First resistance is the 20 day moving average crossing at 5.533
Second resistance is overnight high crossing at 5.537

First support is last Thursday's low crossing at 5.060
Second support is the 75% retracement level of the December-January rally crossing at 4.919

Just click here for your FREE trend analysis of natural gas ETF UNG

The U.S. Dollar was lower due to profit taking overnight as it consolidates below resistance marked by the 38% retracement level of the 2009 decline crossing at 79.71. Stochastics and the RSI are overbought and are turning bearish signaling that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 78.19 would confirm that a short term top has been posted. If March extends this winter's rally, the 50% retracement level of the 2009 decline crossing at 81.32 is the next upside target.

First resistance is Monday's high crossing at 79.76.
Second resistance is the 50% retracement level of the 2009 decline crossing at 81.32

First support is the 10 day moving average crossing at 78.91
Second support is the 20 day moving average crossing at 78.19

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Crude Oil Daily Technical Outlook Wednesday Morning

Crude oil's rebound from 72.43 extends further to as high as 78.04 so far today an breaks mentioned first target of 38.2% retracement of 83.95 to 72.43 at 76.83. At this point, intraday bias remains on the upside as long as 75.44 minor support holds and further rally could be seen towards 61.8% retracement at 79.55 next. On the downside, though below 75.44 will suggest that rebound from 72.43 has completed and will flip intraday bias back to the downside.

In the bigger picture, crude oil managed to hold above medium term trend line support and rebounded strongly from 72.43. The development argues that medium term rise from 33.2 might not be over yet even though upside momentum is clearly diminishing. Another high above 83.95 might still be seen. Nevertheless, as rise from 33.2 is treated as a correction to down trend from 147.27, we'd continue to look of reversal signal as crude oil approaches 50% retracement of 147.27 to 33.2 at 90.24, which is close to 90 psychological level. On the downside, break of 72.43 will now be an important signal that crude oil has topped out and will turn focus to 68.59 support for confirmation.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

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Your Closing Numbers.....Oil, Natural Gas, Heating Oil and Gasoline

Crude oil closed up $2.88 at $77.31 a barrel today. Prices closed near the session high today and hit a fresh two week high on more short covering and fresh speculative buying interest following recent bullish U.S. economic data and cold weather gripping much of the U.S. A steep three week old downtrend on the daily bar chart was negated today. Bulls gained fresh upside near term technical momentum today as it now looks like a big double bottom reversal pattern has formed on the daily bar chart.

Heating oil closed up 804 points at $2.0353 today. Prices closed near the session high again today on more short covering and fresh speculative buying. The bulls' next upside price objective is closing prices above solid technical resistance at $2.1500.

Unleaded gasoline (RBOB) closed up 888 points at $2.0209 today. Prices closed near the session high on short covering and fresh speculative buying. A steep three week old downtrend on the daily bar chart was negated today.

Natural gas closed up 3.1 cents at $5.464 today. Prices closed near mid range today and were supported on more short covering in a bear market and some cold weather in the U.S. forecast. Bears still have the overall near term technical advantage. The next upside price objective for the bulls is closing prices above solid technical resistance at $5.80.

The U.S. dollar index closed down 24 points at 79.18 today. Prices closed near the session low on more profit taking. No chart damage has occurred. Bulls still have some upside near term technical momentum.

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Where is Crude Oil Headed Wednesday?

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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New Video: Crude Oil…What Does the Chart Say?

It appears as though crude oil has an amazing cyclic quality that can be timed quite accurately with MarketClub’s “Triangle” technology. In this new short video, I showcase this cycle and how you can take advantage of it.

Just click here to watch the new video and as always our videos are free to watch and there are no registration requirements. All we ask for is that you comment on this video if you find it interesting and informative.

Enjoy the video and let us know what you think.

Crude Oil....What Does the Chart Say?

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Is a Short Term Low In For Crude Oil? Here's the Numbers

Crude oil was higher overnight due to short covering as it consolidates some of last week's decline. Stochastics and the RSI are oversold and are turning bullish hinting that a short term low might be in or is near.

Closes above the 10 day moving average crossing at 74.82 would confirm that a short term low has been posted. If March extends this year's decline, the 75% retracement level of the September-January rally crossing at 71.70 is the next downside target.

Crude oil's pivot point for Tuesday, our line in the sand is 73.95

First resistance is the overnight high crossing at 75.44
Second resistance is the 20 day moving average crossing at 78.13

First support is last Friday's low crossing at 72.43
Second support is the 75% retracement level of the September-January rally crossing at 71.70

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Natural gas was higher due to short covering overnight as it extends the rebound off last week's low crossing at 5.060. Stochastics and the RSI are oversold and are turning bullish signaling that additional short covering gains are possible near term.

Closes above the 20 day moving average crossing at 5.535 are needed to confirm that a short term low has been posted. If March extends the decline off January's high, the 75% retracement level of the December-January rally crossing at 4.919 is the next downside target.

Tuesday's pivot point for natural gas is 5.373

First resistance is overnight high crossing at 5.491
Second resistance is the 20 day moving average crossing at 5.535

First support is last Thursday's low crossing at 5.060
Second support is the 75% retracement level of the December-January rally crossing at 4.919

Just click here for your FREE trend analysis of natural gas ETF UNG

The U.S. Dollar was lower due to profit taking overnight as it consolidates below resistance marked by the 38% retracement level of the 2009 decline crossing at 79.71. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term.

If March extends this winter's rally, the 50% retracement level of the 2009 decline crossing at 81.32 is the next upside target. Closes below the 20 day moving average crossing at 78.13 would confirm that a short term top has been posted.

First resistance is Monday's high crossing at 79.76
Second resistance is the 50% retracement level of the 2009 decline crossing at 81.32

First support is the 10 day moving average crossing at 78.88
Second support is the 20 day moving average crossing at 78.13

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Crude Oil Daily Technical Outlook For Tuesday

Break of 75.04 resistance argues that a short term bottom is formed at 72.43 on bullish convergence condition in 4 hours MACD. Intraday bias is flipped back to the upside and stronger rebound should be seen towards 38.2% retracement of 83.95 to 72.43 at 76.83 first. On the downside, though, a break below 72.43 will indicate that fall from 83.95 has resumed for 68.59 key support.

In the bigger picture, the case of medium term reversal continued to build up with fall from 83.95 extended. As noted before, whole medium term rise from 33.2 is viewed as a correction to fall from 147.27 only. Break of trend line support (now at 71/72) level will be the first signal that such rise has completed. Further break of 68.59 will support will confirm this bearish case and will target a retest on 33.2 low as correction down trend from 147.27 resumes. On the upside, though, in case of another rise, crude oil we'd continue to look of reversal signal as crude oil approaches 50% retracement of 147.27 to 33.2 at 90.24, which is close to 90 psychological level.....Nymex Crude Oil Continuous Contract 4 Hours Chart.

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