The new front month February 15 crude oil contract fell to a new 5 ½ year low of 53.94 in last Tuesday’s trade trending sideways into Friday’s close.
For the week, the February contract lost .95 settling Friday at 57.13.
The primary trend remains down although an upside correction following 3 weeks of heavy selling cannot be ruled out. A breakout above the 10 day average could bring in short-covering ahead of the Christmas-holiday.
The 10 day moving average which held as daily high resistance 3 times last week is the first area of resistance today at 58.10 followed by last week’s 59.27 high. Longer term resistance is former daily low support between 64.00-65.00.
Last week’s 53.94 low extending down to the current 2014 spot contract low of 53.60 is primary support followed by weekly chart support between 50.00-50.50. Longer term support and the downside price objective for this current downtrend is a 16-year trend line on the weekly chart between 45.00-47.00.
Friday’s Commitment of Trader’s report showed the funds adding to existing long positions estimated at 284,079 contracts, up 22,303 from the previous week.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Following Index - Bearish
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