March Crude Oil is up 8 cents at $79.67 this morning as I write.  The included chart shows that March crude oil is beginning to struggle as prices approach the down trend line, marked in light blue, just above the $80.00 level.  If prices fail up here, then I would look for prices to return back down to the mid to lower $70’s per barrel once again.  The longer term secular trend for crude oil is still up, but we still may have to go through several weeks of base building before that uptrend resumes.  We will let the charts tell us.  The directional movement indicators are slightly bullish and the ADX line is still falling suggesting that there is no strength behind this near term up move.  I recommend holding our current ratio put spreads.

 Followers of this letter should have the following positions:

 Long one March Crude Oil ($69.00 strike) put option from $2.90

Short 2 March Crude Oil ($64.00 strike) put options from $1.65 each.

Long one March Crude Oil ($62.00 strike) put option from $1.51.

Short 2 March Crude Oil ($57.00 strike) put options from 83 cents each.

 March Crude Oil options expire in 49 days.

 David Hall

 The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.

 This newsletter is not intended for dissemination to the public without prior approval from David Hall.