Technical Oil (2010-05-11)

It appears to us that the image in the daily chart above is showing that the retest level has maintained its stance in front of the two attempts by crude to ascend and return within the ascending channel - support level for the breached ascending channel that has currently turned into resistance -. This factor in addition to MA 100 point to more bearish correction that target 74.50 then 73.65. Keep in mind that momentum indicators could cause positive pressure on crude to push it for a new attempt to return within the ascending channel through 78.65.

The trading range for today is among the key support at 74.50 and the key resistance at 78.65.

The short term trend is expected to the upside as far as 65.60 remains intact with targets at 90.00.

Previous Report Weekly ReportSupport76.0075.1574.5073.6572.75Resistance77.2078.3578.6579.0079.40RecommendationBased on the charts and explanations above our opinion is selling oil with the breach of 76.00 targeting 74.50 and stop loss above 77.20, might be appropriate.