The crude oil market turned back down in Thursday failing to extend the strong gains made on Wednesday.
The October 14 contract for a third time in the past three sessions was unable to rally above weekly high 95.80-96.00 resistance. The pullback yesterday from this resistance moved the October contract down 1.09 settling at 94.45.
The 10 day moving average held as support yesterday and is at the 94.25 level today. A drop under this support would turn the 92.50-92.68 weekly lows into the next downside support.
A breakout from the recent trading range between 92.50 and 96.00 is needed to determine the next leg for the market. A downside breakout under 92.50 support would turn 88.00-89.00 into the downside price target while an upside breakout above 96.00 resistance would likely indicate a market low has been set.
Given the trend for the market since the June high, the eventual breakout should be to the downside.
Technical Indicators: Moving Average Alignment – Neutral-Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bullish
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