Crude Oil: Renaissance For The Bears

Bless those trading volumes and volatility. I expected the charts to limp along through this week, but here we are testing the downside. We’re seeing a renaissance for the Bears on the chart and it’s heading back to the support levels at 10147,10078 and 9986. If we turn back to resistance10262, 10375 and 10420. The front spread slipped to find support to 15, but now seems to be following the flat price back up. We’re go-ing to keep an eye on resistance at 25, 32 and then back up to 45. If flat price slips, look for the spread to take a hit to the 11 area. Today we’re looking for flat price to bounce back and take back the Bulls.

Gasoline:
We’ve moved on to RBX3. That’s a difference a day makes in RB. We are now reset-ting resistance to 26541, 26712, 26915. The support numbers fall back on 26296, 26218 and 26045. The front spread found new life and is testing resistance at 170, 212 and 240. The support looks to hold 129, 100 and 75. The RBCL is taking off with resistance to 932, 970. Support back to 850, 793.

Trends are only for the affected:
Well we take what we can get here. The 10min chart is going to tease us with the overnight move and hopes of an uptrend. This will put the support line in the in the 10160 area and channel resistance start-ing with the 10245 area. We think that upper area can be adjusted and we’ll watch that for now. The 60min chart made us rethink giving up on the downtrend channel. We hit the resistance yesterday and fell off to about the pivot. Today those come in at 10320, 10085. Let’s see.

Fundy you should mention:
It’s great that fund money is ignoring the Government shutdown. Oh wait, they’re not. What we think is going on here is something that is not unusual fund action. This has been the pattern for the past few months. Oil finds a high point and then sells off. Oil then returns to the rally and we start all over again. What has changed is this shutdown and now with oil as the only constant in economic recovery, we may see more investors in oil. The only problem is will they be willing to believe in recovery or expect another recession. Jobless Claims (310K) will be worthless at 8:30am EST and there’s no Import/Export data.

Sorry, I am just physically attracted:
Well I know most of you have already been to the website and checked out the EIA review that is back and running there. For those of you that didn’t, there’s a little thing called gasoline production that raised some eyebrows. The 9.3M b/d was with an adjustment, but nonetheless higher on the week without. This is a strong number and in no way was hurt by the overall build (+100K). Demand was solid and up to 8.9M b/d while imports were strong too at 576K. The point is there was a lot of product being made despite the refineries dropping back so far. We don’t think that those production numbers can stick, but as we see, there’s not a lot of wiggle room to be build any supply in the foreseeable future.

Techies, some Trekkies

200 Day MA 9824

100 Day MA 10264

13 Day MA 10288

8 Day MA 10292

14 Day RSI 40.46

Spread now; Roll later

Everything is expensive

Key support: 15, 11, 06

Key Rests: 26, 32, 44

By Carl Larry