March crude oil has traded in a sideways oscillating range for the past week after making a double top at approximately $93.45. The double top, an evening star setup and a bearish divergence that completed at the $93.46 swing high are all negative factors indicating the move down will probably continue to at least $91.6 tomorrow morning before the EIA Stats are released.
However, the choppy nature of the decline indicates it is likely a correction and that the move up should continue. As stated, at least $91.6 is expected tomorrow, but no lower then $89.1 should hold.
Upon an immediate move higher look for resistance at $93.2, above which March should extend toward key resistance at $94.8.
Below $91.6 there is also support at $90.6, which is in line with the 62% retracement from $88.45 to $93.46. The $89.1 level is the 89% retracement and should hold. A close below $89.1 would open the way for the $88.45 swing low to be tested. This is a crucial because $88.45 is the confirmation point of the $93.45 double top, a move below which would call for a decline into the mid $80s.
CLH11 Retracements to $93.46
Resistance at $93.2 is the 89% retracement from $93.46 to $91.17. Upon a close over $93.2 the move down is likely over and in turn would call for $94.8.
CLH11 Retracements to $91.17
Moving Average Table
First support at $91.6 is confirmed as the 21-day (monthly) moving average. Crossing below this would confirm that a deeper test of support to $90.6 and even $89.1 was underway.
CLG11 Moving Averages
The daily evening star setup now has five stars. The completion point at $91.6 was tested late last week when the $91.17 swing low was made and again on Tuesday by the $91.46 swing low, but in both instances prices failed to close below $91.6. This is actually positive for the immediate term and may indicate the small move down is going to come to an end soon.
CLH11 Daily Candlesticks
Review of Momentum Status
A bearish KaseCD divergence at the $93.46 swing high showed a correction was likely. However, as discussed, March has failed to close below $91.6 and will need to do within the next day or two for the move down to continue.
CLH11 Intraday Momentum
Kase Comments has been provided to you by Kase and Company, Inc. CTA. Written by Dean Rogers AP and edited by Cynthia Kase, CMT, MFTA. See www.kaseco.com or contact Dean Rogers at 505-237-1600 for further information or a free trial of Kase's weekly technical forecast. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of Kase and Company, Inc. Kase and Company, Inc. work products including, but not limited to, reports, comments, forecasts, analysis, and screenshots whether oral or written are publications and are not to be construed in any way as consulting. Screenshots created with TradeStation. ©TradeStation Technologies, Inc. All rights reserved.