Sunday, October 18, 2009

Crude Oil - Breakout

Weekly chart in accord with the overall CRB trend shows a clear Breakout - more importantly over the 200-Week MA at 75.44.

Higher there is a resistance cluster of previous range trading between 85 and 100. And risk is on a close below 65 lows which as I wrote in the current liquidity led monetary expansion seems quite unrealistic. Here is a little piece of 'fundamental' info from Dow Jones:

DJ:Libya OPEC Head: Speculation Driving High Oil Prices:
Libya's OPEC governor Ahmed Elghaber said Sunday the latest crude price rally to levels above $78 a barrel Friday was driven by speculation, not fundamentals, and OPEC members are unlikely to raise production in response to the latest price hike."There's a lot of optimism and the prices are responding to that, not to fundamentals," Elghaber told Zawya Dow Jones in a telephone interview. "I hope this price euphoria does not take us to a bubble that will burst.""This market will correct itself, there's speculation going on but there's not much consumption so there's no point in a production increase," Elghaber said, adding that oil demand will only pick up significantly in the second half next year.

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