Technical Oil (2010-07-29)

After achieving yesterday expectations, we currently await for the daily chart above to show a possible harmonic formation to insure that the daily closing is above 79.50; whereas the chances of resuming this possibility are high. The completion of the pattern could be around 82.50, where these levels are representing 78.6% Fibonacci from the XA leg pattern and 127% correction from the BC leg. From here, overall trading for crude could be in the bullish direction, which for today requires the daily four hour closing below 75.90 not occurring. Keep in mind that the RSI is trading in a neutral manner at a time the MACD index is attempting to remain positive.

The trading range for today is among the key support around 74.80 and the key resistance around 80.10.

The short term trend is to the downside as far as 84.00 remains intact with targets around 61.60.

Previous Report

Weekly ReportSupport77.0076.1575.9075.1574.80Resistance77.7578.5079.5080.1081.00RecommendationBased on the charts and explanations above our opinion is buying crude around 77.10 targeting 80.10 and stop loss below 75.10, might be appropriate.