Oil Technical Analysis October 18, 2011

Light Sweet Crude

CL fell for the session on Monday as traders are shunning the risk assets in the markets. The oil markets will continue to have headwinds as the global economy continues to show signs of lackluster performance. The oil markets will be held in check by the issues in the EU, and technically looks weak as the highs are getting progressively lower. The market is a “sell the rallies” one until we break above the $90 mark on the daily chart.

Brent

Brent markets fell hard on the session as traders continue to shun risk after a parabolic move in several markets. The Brent market actually fell harder than the CL market, and appears particularly vulnerable. The $115 mark looks impressive as resistance, and should continue to keep prices lower. The selling of this market on short-term rallies is probably the best approach as the markets will more than likely continue to be choppy.