Weekly Report (05 September - 09 September 2011) : Crude Oil Futures for October Settlement

On Friday, the commodity dropped heavily to currently trade around 86.00 area and below the short term ascending channel(colored in black) which is within another important ascending channel(in blue). Breaching the channel and 86.00 support suggests bearishness over intraday basis toward 84.00-83.00, while to confirm bearishness over weekly basis , a breach of the main ascending channel is required. Therefore, we expect an intraday bearish move for today however we will remain neutral over weekly basis awaiting a breach of the aforementioned channel in addition to 83.00 pivot to confirm bearishness for the rest of the week.

The trading range for week is among the major support at 79.00 and the major resistance at 89.00.

The short-term trend is to the downside with steady daily closing below 100.00 targeting 65.00.

Previous Report

Support85.5084.5083.0082.3081.00
Resistance86.5087.2087.8089.0090.00
RecommendationBased on the charts and explanations above we recommend selling oil around 86.40 targeting 84.40 and 83.00. Stop loss with four-hour closing above 87.70