CLQ12 - Update for June 22nd, 2012

Price analysis for the week of June 22nd, 2012:

Have Moved From July to August CLQ12

Market Overview: The bearish resolution to last weeks consolidation has opened the very noticeable target of $76.33 (August, 2012 contract) to be hit over the coming sessions. While the push into the 70's itself left the market rather oversold, there is little bullish enthusiasm of late as the market desperately searches for a bottom. The weekly chart does suggest we are into a support zone, so once the current daily AB=CD target is hit, my downside expectations will be rather curtailed until the important low of 74.95 is taken out.

Trading Strategy (1 month): Significant damage has been done to the Crude oil bull that it may take quite a bit of time to clean up the mess. While 50% levels may be hit over the coming months/quarters, I would be surprised to see too much of a rally any time soon. Having said that, price action is so volatile that even an intra-day 50% bounce can translate into many thousands of dollars of profits - a day traders dream!

Trading Plan for this coming week: Look for a test of the hourly 50% level at $81.14 and how it acts after that event. If the market can recapture the important low of $81.39, we may see a dramatic rally back up into the original topping area of $83.81-84.72. Keep your eyes peeled. 

Focus for the week: Using the hourly chart for targets/breakouts and the 9 period ema on the 15m chart for entry points..

• Should the bears remain in control, they will break the market's significant recent low's at $79.77 & $79.46. Should those be broken in earnest one would then have to expect a serious test of the  $77.50-$78 original bottom. Should that are be broken I will then be looking for a resolution to the current daily bearish AB=CD pattern target ($76.33)....

• Should the bulls take control, they will push prices back up through the significant resistance point of $81.15 (hourly 50% level). A consolidation with a subsequent breakout above this level would imply an even larger bullish Inverted Head & Shoulders price pattern. That pattern suggests one ought to be looking for a test of the $84.50 area for completion....

Update as of Wednesday, June 27th

That's all for this post,
Brian Beamish FCSI
The Canadian Rational Investor
the_rational_investor@yahoo.com
http://www.therationalinvestor.ca
http://crisdaytrading.blogspot.ca/

CLN12 - Update for June 15th, 2012

Price analysis for the week of June 15th, 2012:

Market Overview: After a period of free-fall, CL has once again begun to trade within definable ranges. While the price action itself is quite volatile, this in itself suggests to me we are closer to the end of this seasonal correction rather than the beginning. CRI's 1st Two Week's of Q2'12 study (pdf link)suggested commodities in general and energy in particular would under perform but given CL's appreciable drop through the first half of the quarter, one ought not to be too surprised if we went through a few weeks of 'take back' through the end of June and into July. The big unknown event (that being the June 17th Greek elections) are now upon us and given the market's propensity to either be overly optimistic (in good times) and conversely overly pessimistic (in bad) one might take the chance that a 'worst -case-scenario' is already priced into the market. Should there be any positive surprises from this event, one shouldn't be surprised to see an appreciable oversold rally develop.

Trading Strategy (1 week): As stated previously, 'we have officially hit our target zone for this correction. The target zone is based on the 1 year and 2 year 50% levels and currently sits between $89.445 and $92.75. It should not surprise us then to see that the market has basically consolidated around these levels for the past few trading sessions.'

My expectation for this coming week is a test of the Gartley bearish pattern price target Point D on the 2 hour chart above ($86.01). There are several smaller price objectives in and around this area which gives me a high degree of confidence the market wants to test the recent trading range's highs. At that point there should be significant battle between the bulls and bears.

• Should the bears remain in control, they will break the market at the Gartley D. point and I will be looking for a resolution to the current daily AB=CD pattern target ($76.03)....

• Should the bulls take control, they will push prices back up through the significant resistance point of $87.03. A consolidation above this level would bring the 1 year,  2 year and Daily 50% levels back into play ($89.445, $92.75 and $96.28 respectively) but I believe looking that far ahead at the moment is a little premature.

That's all for this post,
Brian Beamish FCSI
The Canadian Rational Investor
the_rational_investor@yahoo.com
http://www.therationalinvestor.ca
http://crisdaytrading.blogspot.ca/

CLN12 - Update for June 8th, 2012

Price analysis for the week of June 8th, 2012:

Market Overview: Amid the turmoil that surrounds Europe and its debt crisis, crude oil prices have dropped materially through this seasonally weak period. It is interesting to see that we are basically testing last fall's lows (74.95) which happened to be right in the mouth of the last European debt crisis. The various referendums/elections etc. seem to point to a climax somewhere near the first week or two of July and that is when I expect to see both the weekly uptrend line tested in earnest and a climax to the selling. Having said that, there is a nice little bottom on the daily charts that is trying to form. Should 87.03 be broken and the market can stay above that level for a few hours, I might be inclined to see a rally back into the daily 50% range (96.35). That is a big IF! For the time being, I am still looking for lower lows and the hourly chart seems to be setting up for a move into the high 79 area in the coming sessions.

Trading Strategy (1 week): As stated previously, 'we have officially hit our target zone for this correction. The target zone is based on the 1 year and 2 year 50% levels and currently sits between $89.445 and $92.75. It should not surprise us then to see that the market has basically consolidated around these levels for the past few trading sessions.'

My expectation for this coming week is a test of either the upper end of our trading range (87.03) and/or the lower end (81.21). A break of either should dictate trade for the remainder of the week. Higher and we can start thinking about the daily 50% level (96.35). A break lower and we ought to still be considering the gap to be filled (79.01) and ultimately the contract low (77.40) to be tested...

That's all for this post,
Brian Beamish FCSI
The Canadian Rational Investor
the_rational_investor@yahoo.com
http://www.therationalinvestor.ca 
http://crisdaytrading.blogspot.ca/