December Crude Oil is up $1.11 per barrel this morning at $$78.56 as I write. The enclosed chart shows that crude oil has corrected 6% off its highs from last week. The directional movement indicators are bullish and the ADX line is stalled sideways. The long term trend for crude oil is very bullish based on the weekly price break out a few weeks ago, suggesting a target of $120 within a year. Although, crude oil is enjoying a nice bounce today, I would expect more downward price testing over the next week. During that period over the next week, I want to look for areas in which to put on a bullish biased trade out to at least February. For now I recommend maintaining the current positions in crude oil.

Oct. 29, 2009
David Hall