CRUDE OIL UPDATE (8:30 pm EST)
Our long position in crude entered on Jan. 23 is doing well as the price has moved from $61 to $66 (March contract chart) in just 4 trading days. There is considerable resistance at $66, however, and we enter another general reversal zone next Tuesday (Feb. 2 - 12). We could see a corrective dip into that time frame, but because this market seems bullish, prices could also edge higher to a potential top in that same window, with a correction following a bit later. I am going to stay long for now with the intention of riding out any correction, unless it goes too deep. The current 15-day moving average is rising steeply and is now approaching a strong support level around $62. That is probably a good stop-loss point for our long position. Even if a correction holds above there, we still need to see a clear break above $66 to support the idea of the trend turning bullish. Geopolitical tensions in the Middle East are driving the current rally. We need to be careful as prices could fall as quickly as they rise.
Our long position in crude entered on Jan. 23 is doing well as the price has moved from $61 to $66 (March contract chart) in just 4 trading days. There is considerable resistance at $66, however, and we enter another general reversal zone next Tuesday (Feb. 2 - 12). We could see a corrective dip into that time frame, but because this market seems bullish, prices could also edge higher to a potential top in that same window, with a correction following a bit later. I am going to stay long for now with the intention of riding out any correction, unless it goes too deep. The current 15-day moving average is rising steeply and is now approaching a strong support level around $62. That is probably a good stop-loss point for our long position. Even if a correction holds above there, we still need to see a clear break above $66 to support the idea of the trend turning bullish. Geopolitical tensions in the Middle East are driving the current rally. We need to be careful as prices could fall as quickly as they rise.
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