Near-Term Crude Oil Outlook
David Solin | Jan 10, 2017 02:37PM ET
The Jan. 4 email affirmed the view of an important crude oil topping near that Jan. 3 high/rising trendline from June (ceiling of potential rising wedge, at $55.00/25). The market has indeed rolled over since, breaking below that bullish trendline from Nov. and with eventual declines to that bullish trend line from Aug./base of the potential rising wedge (currently at $43.75/$44.00) still favored. Note, too, that technicals remain bearish (see sell mode on the daily). At this point there is still no confirmation of such "pattern-wise" (5 waves down for example), but any near-term gains all the way back toward the highs (not currently favored) would be seen in part of this larger topping.
- Nearby support is seen at the base of the bearish channel from the high (currently at $50.10/35) and $48.50/75 (50% retracement from Nov. 14 low at $42.20).
- Nearby resistance is seen at the earlier broken trendline from Nov (currently at $52.00/25) and the bearish trendline/ceiling of the channel from the high (currently at $53.85/00).
- Bottom line: view of important top and with eventual declines to that bull trendline from Aug/base of rising wedge (currently at $43.75/00) remains.
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