Oil Technical Analysis October 12, 2011

Light Sweet Crude

The CL contract had a wild day on Tuesday as the markets went back and forth over the course of the day. The market seemed somewhat “stuck” at this point in time, and the area just above the $85 mark seems to be resistive. The top of the recent range at $90 should continue to keep prices down, and the highs are getting steadily lower over time. This isn’t a bullish sign- even if the market has bounced nicely.

We are sellers or rallies, and especially when we get closer to the $90 level.

Brent

Brent markets had a slightly stronger day on Tuesday, although it is still struggling to reach the $110 level. The highs in this market are getting lower as well, and we think this shows that overall – this market could continue to fall over time. We are sellers of rallies, and would need to see a daily close above the $120 mark to change our bias.