Friday 23 October 2009
The range in weekly crude was small this week, and the close was about
mid-range, not the strongest statement on a chart. The trend is up, however.
The daily chart, shown below, has been moving laterally since Wednesday’s
wide-range rally bar. The volume for that particular bar was not in line given
the total gain. This can mean a lack of conviction on the buyer’s part, and the
last two day’s bars reflect that sentiment.
We recommended long positions at 75.64, as reported, and sold them on
stops at 80.80 during Friday’s activity. The reason was because of the weekly
chart, as described, and the fact that the ease of movement has been to the
downside, intra day. Volume has also been declining when it should expand.
Another little clue, and this occurred after the 80.80 exit, locking in a 516 tic
profit, is when volume shot up, late in the trading day, and price made no net
gain, or at least could not hold the ephemeral gain for that bar. Price declined
instead of following through to the upside. What this tells us is that buying
was spent, a mini-buying climax. Nothing of concern, for this is just a 10
minute chart, but it shows the character of the intra day activity relative to the
earlier observations made and the decision to stand aside.
Now we see what develops next week to go long on a break, or buy back on
strength, if need be.
Cheers!
