Oil Technical Analysis for April 7, 2011

Light Sweet Crude

The light sweet crude contract continues to push northward, as we are currently forming a slightly bullish candle for the day near the $1.09 level. Because of this, it appears that we are forming a base in which to launch further forays into higher prices. Although it appears that the spaces building, it also seems that we will possibly move sideways and rest for a moment until we can attract more buyers in this commodity.

Any movement downward in this market should be considered a buying opportunity as it will simply be a pullback and not a trend change at this juncture. Selling light sweet crude is still impossible as the bullish pressure is just too great.

Brent

The Brent markets actually printed a shooting star today, one of the most bearish candlestick patterns around. However, this should be thought of more along the lines of a pullback coming, rather than a selling opportunity. Until we break a couple of the possible trend lines in this market, selling to simply will not be the way to go. The biggest problem with using the trend lines if you are a seller is that we are so far away from them right now. This is definitely a "buy on the dips" situation.

(Source: http://www.commoditiesmansion.com/general-commodities/oil-technical-analysis-for-april-7-2011/)