DTT Buzz

Crude Oil fell victim to heavy selling pressure during today's trading session. Concerns about the US economy led to selling in anticipation of a significant decrease in demand in Crude and gasoline within the US.

The move took Crude from an intraday high of 146.67 to an intraday low of 136.20, a range of 7.14% (see chart below). A decline in Crude of this magnitude has not been seen in approximately 3 years!

The downside pressure resulted in a short term bear flag. Look for short term resistance in the 139.00 - 140.00 range, and support near 136.00. If Crude breaks below 136 on strong volume, there is potential for a move to approximately 127.00.

In the event there is continued downside in Crude, we may break the 6 month uptrend that's in tact. To portray the uptrend, I have to revert to USO since there is not enough Crude data in my trading software to chart Crude for 6 months. Check out the USO uptrend in the chart below...

Bottom Line: Be on the lookout for a short opportunity in Crude or USO!!

Regards,

Nick Fenton

Sr. Trade Analyst