A reader asked me what’s my take on crude. As of now we’re oversold but could continue down to where I’ve deemed a decent amount of support in the $29.50-30 range. The other scenario has crude rallying up to the $34-34.50 level where it would run into significant resistance.

Bottom line:¬†We are oversold but I wouldn’t chase and short this now. It’s better to wait for a bounce up to the resistance level and then get short. If you’re stuck in a long position at this point, I would hold but if it breaches support and closes below this level it could fall in a hurry, but what I think will happen is a short rally to work off some of the oversold nature of this chart and then a continuation of the intermediate trend, which is down.

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One Response to “Crude Oil Analysis”

  1. Gibbs Says:

    Technically terrible oil.. but I can’t help look at smaller US names.

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