Tuesday, January 25, 2011

Crude Oil Breaks Trend

Or does it? Please see below.
Active Mo. Daily
 click to enlarge
Certainly looks like the usual trend measures have been taken out in the above chart.
Not quite yet in the March contract.

click to enlarge
As expected WTI has broken down , see Crude Oil Outlook  ,  WTI - Bubble in the making? and Crude Oil Update
Taking out the 87.25 suspport level rather definitively this morning. It will be interesting to see if it can close below it. 
Typically this market reverses after taking out significant overlaps, but it's diverged from typical behavior lately, like correlating with the euro.
Note that none of the longs since Dec ! are positive and the spec open interest has been growing and quite high.
Shorter term; could be we have a 1 down with 5 subwaves complete. Still early though.

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