New Video - After a Tough 2010, What's Next for Crude Oil Traders?

I doubt that many traders would argue that the crude oil market in 2010 proved to be a tough commodity sector to get any real feel for the trend and direction. 2010 just did not produce any discernible, lasting trend in the oil market. The trends it has produced have lasted little more than just 3 or 4 weeks at best.

So what's next for crude oil traders in 2010 and into 2011?

In today's short video we examine the fact that crude oil briefly traded over $90 a barrel before falling back. So what made the crude oil market reverse course and fall back? Was it selling, was it profit taking, a technical point, or something else? We are examining crude oil in detail using a tool that we think is very appropriate for this type of market at the moment.

We have not discussed this technical indicator in any of our previous videos and I think when you see how it works and how you can use it your own trading, you will be pretty impressed.

We still look at our "Trade Triangles" of course, but "Trade Triangles" tend to work best with markets that eventually get into big trends and that's really where you make your money.

If you have a few minutes and you'd like to learn about this new/old technical indicator that has generally been overlooked by many traders, you will find this video very interesting. This 30 year old indicator has proven to be very effective in this year's crude oil market so you don't want to miss this video.

As always our videos are free to watch and there are no registration requirements. Please take a moment to leave a comment and tell us what you think of the video and the direction of crude oil.

Watch "After a Tough 2010, What's Next for Crude Oil Traders?"



Share

Is THIS Oil Rally For Real?

Every time crude oil has shown the ability to rally in 2010 experienced commercial traders have scratched their heads in disbelief as tankers fill with crude oil continue to stack up in ports and harbors around the world. Never have we seen oil rally in this way when there has been such a glut of inventory.

Is it different this time? Will the "Obama Claus" rally push crude oil [and commodities in general] through the critical 90+ levels? It's looking like these markets have played out their run and light volume December trading is about to set in. Swing traders and investors beware, this looks like a day traders market for December. Here's your trading numbers for Wednesday....


Crude oil was lower due to profit taking overnight as it consolidates some of the rally off November's low. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 85.30 would confirm that a short term top has been posted. If January extends the rally off November's low, May's high crossing at 93.29 is the next upside target.

First resistance is Tuesday's high crossing at 90.76
Second resistance is May's high crossing at 93.29

Crude oil pivot point for Wednesday morning is 89.16

First support is the 10 day moving average crossing at 86.75
Second support is the 20 day moving average crossing at 85.30

Natural gas was higher overnight as it consolidates some of Tuesday's decline. Stochastics and the RSI are diverging but are bullish signaling that sideways to higher prices are possible near term.

If January extends the rally off November's low, the 38% retracement level of the June-November decline crossing at 4.654 is the next upside target. Closes below the 20 day moving average crossing at 4.267 would confirm that a short term top has been posted.

First resistance is Tuesday's high crossing at 4.545
Second resistance is the 38% retracement level of the June-November decline crossing at 4.654

Natural gas pivot point for Wednesday morning is 4.440

First support is the 10 day moving average crossing at 4.345
Second support is the 20 day moving average crossing at 4.267

Gold was lower due to profit taking overnight as it consolidates some of the rally off the mid-November low. Stochastics and the RSI are becoming overbought, diverging and turning neutral hinting that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 1378.50 would confirm that a short term top has been posted. If March extends this year's rally into uncharted territory, upside targets will now be hard to project.

First resistance is Tuesday's high crossing at 1432.50

Gold pivot point for Wednesday morning is 1412.70

First support is the 10 day moving average crossing at 1389.70
Second support is the 20 day moving average crossing at 1378.50



Share

Merry Christmas Crude Oil Bulls...From President Obama!

Is the second term of the Clinton presidency back? Even Bill couldn't have timed a better trade as President Obama let's it be known that he is willing to extend the Bush era tax breaks for an extension of unemployment benefits. This as our world currency [crude oil of course] hovers around the most critical level of 90+ a barrel. Is $90 our new support number? Is $100 a barrel in the cards in December? The rest of the week and especially Fridays close will tell us a lot, but for now here is your support, resistance and pivot numbers for Tuesdays trading.

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

If January extends the rally off last week's low, the 87% retracement level of May's decline crossing at 90.62 is the next upside target. Closes below the 20 day moving average crossing at 84.34 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 90.46
Second resistance is the 87% retracement level of May's decline crossing at 90.62

Crude oil pivot point for Tuesday morning is 89.23

First support is the 10 day moving average crossing at 86.23
Second support is the 20 day moving average crossing at 85.34

Natural gas was higher overnight as it extends the rally off November's low. Stochastics and the RSI are diverging but have turned bullish signaling that sideways to higher prices are possible near term.

If January extends the rally off November's low, the 38% retracement level of the June-November decline crossing at 4.654 is the next upside target. Closes below the 20 day moving average crossing at 4.271 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 4.545
Second resistance is the 38% retracement level of the June-November decline crossing at 4.654

Natural gas pivot point for Tuesday morning is 4.471

First support is the 10 day moving average crossing at 4.357
Second support is the 20 day moving average crossing at 4.271

Gold was higher overnight as it continues to rebound off the mid November low. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

If March extends this year's rally into uncharted territory, upside targets will now be hard to project. Closes below the 20 day moving average crossing at 1380.30 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 1429.40.
Second resistance is at 1438.10

Gold pivot point for Tuesday morning is 1418.40

First support is the 10 day moving average crossing at 1390.00.
Second support is the 20 day moving average crossing at 1380.30.



Share

Is This it.....is the SP 500 and Gold in the Last Stages of the Rally?

When we think of Elliot Wave patterns, we think of one market analyst. David Banister of The Market Trend Forecast.Com. We can't think of anyone who has called the moves better in this market in 2010 then Banister. And as we move to critical resistance levels in this rally it's time to check in with him and see how much room is left in this bull run. Here is his most recent article from Monday evening December 6th.......

The Elliott Wave patterns that I use to forecast movements ahead of time in the SP 500 and Gold for my subscribers have been textbook perfect for quite some time. We can go back to the March 2009 lows and clearly identify 5 waves up to the 13 month initial rally high in April of this year. This was followed by a clear ABC wave 2 pattern to the 1010 lows on July 1st. Right now, the SP 500 is in wave 5 up since July 1st, and that means this is a terminal wave underway before a good sized correction ensues.

Investors should expect the SP 500 to rally up to 1285 as a minimal upside target, with the market likely peaking in the Mid January 2011 period prior to a new correction pattern. That correction will take the markets down to the 1150-1180 ranges more than likely from the January highs and knock the sentiment levels back to bearish before the next big advance. Below is where I see the current wave patterns, and as you can see, this is the 5th and final wave stage of the advance. Ride it up, but lighten up as we approach my figures is my advice. Subscribers to my TMTF service have been riding this stage of the bull long since early July, and we keep them updated every week on the action.

Gold has also completed it’s 4th wave corrective pattern at $1331 per ounce recently, and as I have forecasted recently should continue it’s upward trajectory to about $1480-$1525 before a good sized correction will ensue. Gold bottomed this summer in a classic wave 2 correction at $1155 per ounce, which was a 50% Fibonacci re-tracement of the rally up to $1225 from $1040. My objectives are for this pattern to complete around the same time as the SP 500 peak in Mid January as well. Downside objectives from there are likely to be to the $1310 per ounce range from the $1480-$1525 peaks, but more on that as we approach. I do not like to get too far ahead of myself in my projections, taking it one leg and pivot at a time.

If you’d like to be consistently ahead of the major market and precious metals moves and profit from that positioning, then consider subscribing today. Visit Market Trend Forecast.com for the details and a coupon to subscribe.


Share

Markets Look to Take a Beating on Bernake Comments

Commodity and equity markets look to take a hit on Monday morning mostly due to comments made by Ben Bernanke over the weekend about his views on the possibility the economy will need additional stimulus.

Here is your trading numbers for Monday trading in crude oil, natural gas and gold.

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

If January extends the rally off last week's low, the 87% retracement level of May's decline crossing at 90.62 is the next upside target. Closes below the 20 day moving average crossing at 85.18 would temper the near term friendly outlook.

First resistance is the overnight high crossing at 89.76
Second resistance is the 87% retracement level of May's decline crossing at 90.62

Crude oil pivot point for Monday's trading is 88.61

First support is the 10 day moving average crossing at 85.31
Second support is the 20 day moving average crossing at 85.18


Natural gas was higher overnight as it extends the rebound off last Tuesday's low. Stochastics and the RSI are turning bullish hinting that sideways to higher prices are possible near term.

Closes above the reaction high crossing at 4.515 are needed to renew the rally off November's low. If January renews the decline off the reaction high crossing at 4.515, November's low crossing at 3.853 is the next downside target.

First resistance is the overnight high crossing at 4.428
Second resistance is November's high crossing at 4.515

Natural gas pivot point for Monday's trading is 4.340

First support is last Tuesday's low crossing at 4.126
Second support is November's low crossing at 3.853

Gold was higher overnight as it continues to rebound off the mid-November low. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

If March extends the rebound off the mid November low, November's high crossing at 1426.00 is the next upside target. Closes below the 20 day moving average crossing at 1379.20 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 1420.00
Second resistance is November's high crossing at 1426.00

Gold pivot point for Monday's trading is 1,402.80

First support is the 10 day moving average crossing at 1383.20
Second support is the reaction low crossing at 1352.00



Share

Where Should You Be Playing Crude Oil?

For most retail traders trading crude oil and natural means using tickers like the popular ETF's like USO, OIH, UNG or DIG. But one often over looked company that has been the darling of our hedge fund is NOV, National Oilwell Varco. As the leader in oil rig production for many years through both organic growth as well as Merger and acquisition activity National Oil Varco has stay above support levels for some time giving us safe and consistent profitable swing trades.

One tool we use to watch the trend in NOV is our Smart Scan Chart Analysis technology. And as of this morning [12-6-10] our Smart Scan Analysis still confirms that a strong uptrend is in place for NOV and that the trend remains positive longer term. As always you should trade this strong uptrend with tight money management stops. This kind of rating indicates that NOV is being driven by commercial traders and insiders.

NOV scored +100 on a scale from -100 (strong downtrend) to +100 (strong uptrend). Here is how NOV rated on just a few of our indicators.

+10......Last Hour Close Above 5 Hour Moving Average
+15......New 3 Day High on Friday
+20......Last Price Above 20 Day Moving Average
+25......New 3 Week High, Week Ending Nov. 27th
+30......New 3 Month High in November
+100.....Total Score

Here is a preview of our MarketClub Trade Triangle Chart Analysis and Smart Scan technology system



Share

Crude Oil Weekly Technical Outlook For Sunday Dec. 5th

Crude oil's rise from 80.06 accelerated to as high as 89.49 last week and the break of 88.63 indicates that whole rally from 64.23 has resumed. Initial bias remains on the upside this week for next near term target of 61.8% projection of 70.76 to 88.63 from 80.06 at 91.10. On the downside, below 87.14 minor support will turn intraday bias neutral and bring some consolidations before staging another rise.

In the bigger picture, the break of 88.63 resistance confirms that whole medium term rise from 33.2 is still in progress and has resumed. Such rally is treated as the second wave of the consolidation pattern that started at 147.27 and should target 50% retracement of 147.27 to 33.2 at 90.24 and possibly further to 61.8% retracement at 103.70. On the downside, break of 80.06 support is needed to be the first sign of medium term reversal and break of 64.23 is needed to confirm. Otherwise, outlook will remain bearish.

In the long term picture, rebound from 33.2 is not finished yet. But overall view remains unchanged. Crude oil is in a long term consolidation pattern from 147.27, with first wave completed at 33.2, second wave from there unfolding. Current development suggests that a breach of 61.8% retracement at 103.70 is likely. But we'll then start to focus on reversal signal again above 103.70.

Nymex Crude Oil Continuous Contract 4 Hour, Daily, Weekly and Monthly Charts

Share

Is This a Broad Market Reversal....Better Hold On To Your Hat!

From Chris Vermeulen at The Gold and Oil Guy.com......

This had been an exiting week for traders as the equities market was on a verge of a major sell off. Fortunately, we were watching the market very closely and saw the sentiment and market internals shift shortly after a new low was set last week. That was an early warning for us that a trend reversal to the upside could happen at any hour or day this week.

Wednesday and Thursday’s rallies were on solid volume and the market internal indicators along with market breadth were strong also. There has been a large surge of new highs across the board on the NYSE, NASDAQ and AMEX. These numbers tell me that it’s not just one sector moving the market; instead it’s a broad market advance (institutional buying).

While I don’t typically try to pick major tops or bottoms because of the added risks and lower probability of winning trades, I do tend to spot them forming a few days in advance allowing me to tighten stops and take some profits on positions.

Trend reversals typically have large violent moves near the beginning and end of their life cycle making things not only tougher to trade but potentially more costly. Once I see a trend confirmed with moving averages, volume, and sentiment along with market breadth that’s when I start looking to take positions on pauses or pullbacks to support zones. This greatly increases the odds of winning/making money from the market. There are some really great Options Trading Strategies for taking advantage of these volatility changes in the market which you can get at Options Trading Signals.Com.

SPY Daily Chart:
As you can see the market has clearly broken to the upside above key moving averages after finding support at the 50 day moving average. This rally has some solid volume behind it which I like to see also.

The first 3-4 days of a trend reversal generally post some give moves but after that initial thrust expect a pause or pullback to happen.

SPY 60 Minute Intraday Chart:
We were lucky enough to take profits on our inverse SP500 trade as the market started to give us mixed signals of a possible rally. A couple days later on Nov 26th we saw a major shift within the market sentiment preventing us from shorting the market again.

Two days later the broad market gapped higher triggering protective stops/short covering sparking a fierce two day rally which took the market up to a major resistance level. I do feel as though the market is going higher, but right now, everything is WAY over bought and trading at resistance. Even if the market moves higher for another 2-3 days and breaks this resistance level, it will most likely have a pause, or pullback as it regains energy for another thrust higher.

Mid-Week Trading Conclusion:
In short, it looks as though the trend is now up and the Christmas rally could be gearing up for a good one!

Be sure to get Chris Vermeulen's Free Trading Analysis Book and Analysis or visit The Gold and Oil Guy.Com to get his Pre-Market Trading Videos, intraday updates and trade alerts



Share

Crude Oil, Natural Gas, Gold and Dollar Commentary For Friday Morning Dec. 3rd

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

If January extends the rally off last week's low, November's high crossing at 89.10 is the next upside target. Closes below the 10 day moving average crossing at 84.54 would temper the near term friendly outlook.

First resistance is the overnight high crossing at 88.33
Second resistance is November's high crossing at 89.10

Crude oil pivot point for Friday morning is 87.47

First support is the 20 day moving average crossing at 85.07
Second support is the 10 day moving average crossing at 84.54

Natural gas was slightly lower overnight as it consolidates some of the short covering gains of the past two days. In the meantime, stochastics and the RSI are turning neutral to bullish hinting that sideways to higher prices are possible near term.

Closes above the reaction high crossing at 4.515 are needed to renew the rally off November's low. If January renews the decline off the reaction high crossing at 4.515, November's low crossing at 3.853 is the next downside target.

First resistance is the overnight high crossing at 4.370
Second resistance is last week's high crossing at 4.515

Natural gas pivot point for Friday morning is 4.306

First support is Tuesday's low crossing at 4.126
Second support is November's low crossing at 3.853

Gold was higher overnight as it continues to rebound off the mid-November low. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

If March extends the rebound off the mid-November low, November's high crossing at 1426.00 is the next upside target. Closes below the 10 day moving average crossing at 1375.60 would confirm that a short term top has been posted.

First resistance is Thursday's high crossing at 1399.70
Second resistance is November's high crossing at 1426.00

Gold pivot point for Friday morning is 1,390.90

First support is the 10 day moving average crossing at 1375.60
Second support is the reaction low crossing at 1331.10


Secrets of the 52 Week High Rule

Share

OPEC Expected to Keep Oil Production Quota Unchanged

OPEC will probably keep its production quota unchanged when it meets on Dec. 11 in Ecuador, ministers from Angola, Venezuela and Libya said. The Organization of Petroleum Exporting Countries considers oil at $80 to $85 a barrel a “comfortable price,” Angola’s Minister of Petroleum Jose Maria Botelho de Vasconcelos said yesterday. Crude traded around $86 a barrel in New York today. Venezuela’s energy minister Rafael Ramirez, who said he prefers a price level of $100 a barrel, told reporters in Doha today that the group will likely maintain its existing output target.

“The current environment is of some stability,” Angola’s Vasconcelos said in an interview. “The sentiment among members is for maintaining the production level.” Libya’s top oil official, Shokri Ghanem, said yesterday in Doha that the organization will seek stricter compliance with the current production target. OPEC, which produces about 40 percent of the world’s oil, hasn’t changed its formal limit since December 2008, when it announced record supply cuts and a quota of 24.845 million barrels a day.

The group’s adherence to that level has faltered as recovering demand and rising prices encourage members to exceed their individual allocations. Compliance among the 11 nations bound by quotas slipped to 51 percent in October, according to data from the group published on Nov. 11. Qatari Energy Minister Abdullah bin Hamad al-Attiyah said today he won’t attend the Dec. 11 gathering in Quito, Ecuador.

Angola’s Vasconcelos said he expects the country’s oil production to increase to 1.9 million barrels a day next year, close to its maximum capacity. Angola pumped an average of 1.73 million barrels a day in November, according to a Bloomberg survey of producers and analysts on Nov. 30. OPEC’s 12 members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Iraq is exempt from the quota system.

Posted courtesy of Bloomberg News

Bloomberg reporter Grant Smith can be reached at gsmith52@bloomberg.net

Share