Weekly Report (May 02-05, 2011)
Crude moved to the downside once again approaching 114.50 and we can see how the CD leg of the suggested harmonic formation is extending over time and accordingly weakening it as negative reversals are seen on momentum indicators. Nevertheless, stability above 112.45 and 111.00 will keep the positive expectations valid while breaching 111.00 with four-hour closing might drive the pair towards 109.75 at least.
The trading range for this week is among the major support at 107.30 and the major resistance at 116.75.
The short term trend is to the upside with steady daily closing above 105.75 targeting 118.45.
|Recommendation||Based on the charts and explanations above our opinion is buying crude around 112.20 and take profit in stages at 114.50, and 115.55 and stop loss with four-hour closing below 111.00 might be appropriate this week (Shall crude trigger the stop loss, we recommend selling crude below 111.00 and take profit in stages at 109.75 and 108.65 and stop loss with four-hour closing above 113.00 might be appropriate)|