Weekly Report (20-24 June, 2011) for Crude Oil Futures for August Settlement

We have seen oil dropping heavily during the past couple of days after breaking out of the symmetrical triangle we mentioned in our previous reports, it reversed to the downside from levels near 100.00 and lately broke 94.60 important support level, RSI over four-hour basis is struggling around oversold area suggesting a possible correction. Despite price action suggests bearishness during this week, oil is trading at the moment below the 200 day SMA; we need a daily closing around these levels to confirm bearishness toward 88.00 areas. Nevertheless, our outlook for oil this week is bearish

Trading range for the week is among the major support at 85.00 and the major resistance at 98.00

The short term trend is to the downside with steady daily closing below 106.70, targeting 87.00

RecommendationBased on the charts and explanations above our opinion is selling crude around 94.00 and take profit in stages at 92.10 , 90.00 and 88.00. Stop loss with daily closing above 95.00 may be appropriate for this week.