Crude oil futures in the January contract had a wild trading week continuing a bearish trend after settling last Friday around 66.15 basically going out at the same price today and if you are still short this market I would continue to place my stop loss above the 10 day high which currently stands at 77.02 risking around 1100 points or $11,000 per contract plus slippage and commission as this is a high risk trade at the current time.
However if you are not currently short this market I would sit on the sidelines and look for a better trade. The chart structure will start to improve dramatically starting on Monday as the risk will come down dramatically as the trend continues with gold and crude oil to the downside as the commodity markets as a whole remain bearish as the U.S dollar hit another 5 year high today so continue to play this to the downside as I think the oversupply issue worldwide will put a lid on prices here in the short term.
Eastern Europe and Russia are both heading into recession while the United States economy is looking very solid as consumers will definitely benefit from lower prices at the pump which should continue to put upward pressure on the equity markets in my opinion, however with OPEC deciding last week not to cut production this market should continue to move to the downside as the chart structure has started to improve, however there is extreme volatility in this market at the current time with high risk so move on and do not try to pick a bottom as I’m not bullish crude oil prices at all.
Chart Structure: Improving
This weeks crude oil market summary was provided by our trading partner Mike Seery. Get more of his calls on commodities....Just Click Here
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