Weekly Report01 -05 /02 / 2010

Crude managed to achieve a clear breach of support for the medium term ascending channel at 74.50; achieving a descend that managed to hit into the MA 200 today at 72.40 and therefore forming strong support in front of the pair's descend. Momentum indicators are showing positive signs that might push the pair to achieve some bullish correction to touch resistance for the descending short term channel, which currently control trading before continuing the expected bearish direction for this week; where it will be essentially activated after the breach of pivotal support 82.40 to head towards 70.00 then $68.80 per barrel. The bearish short term direction will prevail if the daily closing remains below 74.50.

The trading range for today is among the key support at 68.80 and the key resistance at 76.90.

The general trend is to the upside as far as 47.20 remains intact with targets at 85.00.

RecommendationBased on the charts and explanations above our opinion is selling oil from 73.40 targeting 71.80 and stop loss above 74.50, might be appropriate.