The Commodity Specialist view – Price action earlier on in 2010 was seen to favour a bearish outlook for the weeks/months ahead. The recent strong correction/recovery, though often a feature when trends are in the process of turning, has now neared key resistance, which bears need to hold.
- BRENT CRUDE WEEKLY CHART – CONTINUATION:
Price earlier failed to hold above the 38.2% recovery level (which coincides with the Aug-06 high).
The structure of the chart and break of 23.6% pullback level suggested a more prolonged bear phase was unfolding.
The current strong bounce does not yet throw doubt on this analysis – now look closer… - BRENT CRUDE DAILY CHART – APR -10:
The stronger-than-expected rebound pushed above the 77.49 03-Feb high, which raised questions for the bears.
However, in the Commodity Specialist Guide we have been noting key resistance from a s/term bear channel top projection (now tested), ahead of the 80.00 76.4% bounce level – a clear close above this would confuse the outlook, and sideline previous bears.
At time of writing there remains the chance that the s/term recovery will lack staying power, but reversal must happen soon.
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