Crude Oil – Capped by 62% Point
30th March 2016
Crude – Sellers return at 62% point
This year’s trading has been dominated by a reaction to negative technical divergence that resulted in a Double Bottom and a rally of almost $16.
Crude was bought to higher levels for 6 weeks in a row and recovered 62% of the October – January/February deterioration. But that level has capped the upside over the last 2 weeks and, after an indecisive unchanged close last week, has now attracted selling interest.
A look at the daily chart adds to a more negative tone for Crude Oil sentiment. Lower highs have led to a break below the key 13 day moving average for the first time since mid-February while the RSI indicator has negatively crossed it’s own moving average for the first time since early last month.
So the focus returns to the downside and our medium term view is again negative. Our targets are to 35.96, the 2 week low point, then 32.94, the lowest levels traded over the last 4 weeks.
