Weekly Report (22-26 August 2011) for Crude Oil Futures for October Settlement

As seen on the chart above, oil has breached important long term support levels such as the ascending channel and the 52 weeks SMA as shown on image and lately it managed to end the week below 85.00 support(which is also the 38.2% Fibonacci correction for the long term bullish wave starting from 2008 lows) suggesting a possible downside move for this week as well, the move may attempt to retest the recent low near 75.00 area. Trading range for the week is among the major support at 74.00 and the major resistance at 89.00The short term trend is to the downside with steady daily closing below 100.00, targeting 65.00.

Previous Report

Support81.5080.0079.4078.1577.00
Resistance83.5084.6085.7086.2087.70
RecommendationBased on the charts and explanations above we recommend selling oil around 83.50 targeting 80.50 and 77.00 and stop loss with four-hour closing above 85.00