http://marketsanalysis.net/?p=1542
Trend lines, moving averages and RSI are our main tools in this commentary; weâll try to identify the weight-of-evidences, pinpoint the prospected scenarios and the most important structure range to watch.
(1) The price action since mid-2009 is being surrounded by four trend lines. These parallel trend lines worked as firm support and resistance levels; the upper parallel resistance line constituted a ceiling over prices and forced the security to lower trend lines. A breakout below any line considers a nose dive to the lower one and a breakout over any line targets the next upper line. The oil, in the last attempt, bounced strongly off the last defense line, the lower rising support line; this bounce gives a minimum up-side target near the middle rising resistance line @ 107.
You should know that; as long as the lower rising support line remains intact, the major up-trend will also remain intact. You also should know that; the Oil may find resistance from the middle rising line, but a decisive up-breakout over it will force the security to the next rising resistance line (near 115/120). The last thing you should know is that; âa decisive down-breakout below 89.50 should triggers your Sell Stop. This breakout changes the structure completely.
(2) You can notice that moving average is taking a bullish shape; the 50-week EMA is rising over the 200-week EMA, the 50-week EMA is working currently as a rising support, nearly in the middle between the lower double trend lines, giving additional evidence of the major importance of this zone.
(3) The RSI ârange analysisâ is a unique usage which helps identify or confirm the current trend. The indicator is oscillating between two important ranges; the green horizontal lines and the yellow horizontal lines consider a Bull Support Range and Bull Resistance Range, respectively. The indicator is currently bouncing off the lower range and targeting the upper resistance range. As long as the RSI find support from the lower green horizontal line, the major up-trend will continue gaining momentum. A decisive down-breakout below it may give an advance warning of a serious change in the structure. The RSI also is giving its own signal; a âPositive Reversalâ signal has been triggered- see the declining white line. This bullish signal gives a target (@ 117.85).
In brief, market participants should watch the lower rising support line (@ 89.65) and the lower green horizontal support line in the RSI; as long as these levels remained intact, the up-trend is safe, favorable and you can bet on a thrust to at least the upper resistance line @ 115/120 range. On the other hand, a decisive down-breakout below 89.50 and/or a decisive penetration below the green horizontal line in the RSI signal a complete loss in up-side momentum and warn of a serious bearish outcome. A decisive down-breakout below 89.50 considers a nose dive to AT LEAST 81.85 @ the 200-week EMA.
Ramy Rashad, CMT
Trend lines, moving averages and RSI are our main tools in this commentary; weâll try to identify the weight-of-evidences, pinpoint the prospected scenarios and the most important structure range to watch.
(1) The price action since mid-2009 is being surrounded by four trend lines. These parallel trend lines worked as firm support and resistance levels; the upper parallel resistance line constituted a ceiling over prices and forced the security to lower trend lines. A breakout below any line considers a nose dive to the lower one and a breakout over any line targets the next upper line. The oil, in the last attempt, bounced strongly off the last defense line, the lower rising support line; this bounce gives a minimum up-side target near the middle rising resistance line @ 107.
You should know that; as long as the lower rising support line remains intact, the major up-trend will also remain intact. You also should know that; the Oil may find resistance from the middle rising line, but a decisive up-breakout over it will force the security to the next rising resistance line (near 115/120). The last thing you should know is that; âa decisive down-breakout below 89.50 should triggers your Sell Stop. This breakout changes the structure completely.
(2) You can notice that moving average is taking a bullish shape; the 50-week EMA is rising over the 200-week EMA, the 50-week EMA is working currently as a rising support, nearly in the middle between the lower double trend lines, giving additional evidence of the major importance of this zone.
(3) The RSI ârange analysisâ is a unique usage which helps identify or confirm the current trend. The indicator is oscillating between two important ranges; the green horizontal lines and the yellow horizontal lines consider a Bull Support Range and Bull Resistance Range, respectively. The indicator is currently bouncing off the lower range and targeting the upper resistance range. As long as the RSI find support from the lower green horizontal line, the major up-trend will continue gaining momentum. A decisive down-breakout below it may give an advance warning of a serious change in the structure. The RSI also is giving its own signal; a âPositive Reversalâ signal has been triggered- see the declining white line. This bullish signal gives a target (@ 117.85).
In brief, market participants should watch the lower rising support line (@ 89.65) and the lower green horizontal support line in the RSI; as long as these levels remained intact, the up-trend is safe, favorable and you can bet on a thrust to at least the upper resistance line @ 115/120 range. On the other hand, a decisive down-breakout below 89.50 and/or a decisive penetration below the green horizontal line in the RSI signal a complete loss in up-side momentum and warn of a serious bearish outcome. A decisive down-breakout below 89.50 considers a nose dive to AT LEAST 81.85 @ the 200-week EMA.
Ramy Rashad, CMT
