Technicals, February 2, 2012; 6:45am
Yesterday afternoon and overnight's clear break below 23-Jan's 97.40 low detailed in the 240-min chart below confirms at least the intermediate-term trend as down and defines yesterday's 99.49 high as the latest corrective high and risk parameter we believe this market's now got to recoup to mitigate the prospect for more significant losses. Overnight's 97.99 high represents an even tighter, micro risk parameter around which some bullish decisions may be able to be conducted. But given this market's volatile behavior over the past month or so, such a tight risk parameter is exposed to whipsaw risk.
shown in the weekly log scale chart below.
These issues considered, traders are advised to move to a bearish policy with strength above at least 99.49 required to diffuse this bearish threat. In lieu of such 99.49+ strength, traders should not be surprised by not only lower prices in the period immediately ahead, but possibly accelerated, relentless losses. And given the generally positive correlation this crude oil market has with the equity indexes, it begs the question of what tomorrow's nonfarm payroll report might have in store for stocks.
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