Is Crude Oil Attracting Much Stronger Buyers?

By Rod David,

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The following are the latest daily summaries of my ongoing intraday coverage, providing context to interpret price action. Any prices listed are for a contract's current "front month." Their direction tends to correlate with any ETFs listed for each.

Today's Highlight: Crude oil's buyers were rewarded Wednesday for having absorbed two consecutive sessions of intraday dips. The reward was delivered so quickly that the pattern has greater potential for extending even higher.

Dollar Basket
The rally through Tuesday needed to begin reversing down immediately if it were going to avoid extending much higher. Wednesday's narrow ranging didn't probe any higher, so the delay can be excused if a drop is evident early Thursday.

Jun Contract EC; (NYSEARCA:FXE)
A rejection of Tuesday's test of recent lows was needed without delay to maintain potential for resuming and extending the rally. Wednesday's narrow sideways ranging allows delaying the resolution into Thursday's open.

Apr Contract GC; (NYSEARCA:GLD)
Tuesday night's recovery back above 1418.50-1420.00 resistance extended back up to 1433.50. There continues to be no reason for much further delay in extending the rally through 1441.00 resistance to fulfill its 1556.00 objective.

May Contract SI; (NYSEARCA:SLV)
Tuesday's gap down didn't seem to have gained traction. An overnight rally held tests of the 23.25 buy signal, but still gapped up Wednesday. Extending above 23.55 would confirm a new rally leg underway initially targeting 24.15.

30-Year Treasury
Mar Contract US; (NYSEARCA:TLT)
Tuesday's reaction down from attacking the 149-14 objective repeated recent prior behavior of consolidating narrowly at 148-00 pullback limit. Despite the potential unfinished business above, the uptrend continues to appear tenuous.

Crude Oil
Apr Contract CL; (NYSEARCA:USO)
This week's volatile dips that nevertheless recovered back up to 89.20 had earned a probe of fresh highs to at least 91.05. That was probed by Wednesday's $2.30 rally testing 91.50. Holding above 90.55 would allow extending higher to test 93.55-93.75.

Natural Gas
The retracement of last Thursday's surge was retraced entirely back to its 4.17 origin at Wednesday's low. However, the breakout needed to hold 4.21 to be assured of resuming the rally. Now, 4.35 must be recovered to signal the rally has resumed.

Editor's note: Rod's analytical techniques are designed to efficiently identify targets and turning points for any liquid stock or market in any time frame. He applies his techniques live intraday, primarily to S&P futures, at RodDavid .com .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Commodities
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