Friday, July 8, 2011

Daily NYMEX CRUDE OIL: The Strong Downtrend Line Breakout Could Spur Prices Higher To Retest US$110 Zones.

Commodity to watch: Crude oil

Crude oil: Strong breakout could spur prices higher to retest US$110 zones


Nymex crude oil surged 2.1% to US$98.67 (3-week high) amid declining weekly U.S. crude oil inventories and a weaker greenback after ECB increased its benchmark rate by 25bps to 1.5%. Sentiment was also boosted by lower weekly jobless claims, strong retail sales and better-than-expected ADP report, raising hopes that economic recovery is regaining traction.

Despite tumbling from 52-week high of US$114 on 2 May to US$91 lately, crude oil has rebounded strongly by 8.8% (from recent low) to US$99/barrel overnight.

On the back of a strong breakout and bullish technical readings, crude oil prices are likely to turn more bullish in the near term. Immediate resistance zones is US$101.5 (upper Bollinger band), followed by a cluster of resistance from US$105-110/barrel. Key support levels are US$97.4 (30-d SMA), US$95.8 (mid Bollinger
band) and US$91.

Daily NYMEX CRUDE OIL: The Strong Downtrend Line Breakout Could Spur Prices Higher To Retest US$110 Zones
CrudeOil08-07-2011



Source: HLIB Research

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