Finding buying support on the low end and watching the buyers dry up when they get back to the high end. Also, the current trading trend seems to be no different.
I’ve been moderately bearish on Crude for some time now and have been waiting for a good opportunity to sell it short. As prices trade closer to the $100/barrel level the opportunity to sell might be just around the corner but we’re likely in for at least one more rally before that happens.
May Crude broke support when it traded below 96.70. I suspect buyers will find this price attractive and try to rally it up for the short term. However another failure to break 97.50 would spell the end of the buyers after which the sellers should have no problem taking control of the market sending it lower. In fact, I would look at a possible failure and reversal to come as early as 97.25 (May).
Of course if traders manage to push it above 97.50 then it’s obvious the buyers have the market well in hand and all bets are off. But look for repeated failed attempts at rallies for a hint that Crude will once again hold the top end of the trading range.
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