Morning Report: Crude Oil Futures For February Settlement

Oil dropped sharply after testing the descending resistance we mentioned yesterday, to find a support at the previously breached descending resistance around 99.10 and below our first downside target. Stochastic is attempting to crossover negatively, trading below 99.00 level may push for further losses for the commodity for a possible test of the 97.50 support level. In general, we expect further downside pressure so long as trading remain below 101.50 over daily closing basis.

The trading range for the day may be among the major support at 96.50 and the major resistance at103.45.

The short-term trend is to the downside with steady daily closingbelow 105.00, targeting 65.00.

Previous Report

Weekly Report

Support99.3598.5098.0097.5096.75
Resistance99.80100.20100.60101.50102.30
RecommendationBased on the charts and explanations above our opinion is selling crude around 100.60 and take profit at 99.35 and 97.50 stop loss with daily closing above 101.50 might be appropriate.