The major terror attacks in Mumbei, India, did not produce significant upside price pressure in crude oil prices, and this is a bit surprising to some market watchers. Had the same event occurred during the bull market run in crude oil earlier this year, it's likely that crude prices would have reacted with a sharp rally. The lack of a significant bullish price response from the liquid energy markets in the wake of the India attacks only underscores the overall bearish tenor of these markets.
Technically, serious chart damage has been inflicted upon the liquid energy markets. The recent drop in nearby Nymex crude oil futures prices below what was major psychological support at $50 a barrel did open the door to further downside price pressure, including a challenge of chart support at the $40 mark. Crude oil prices remain in a strong downtrend on the charts, from the summertime highs.
P.S. Will you be there when Cramer makes his next move?
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Oil The Time for Refiners Is Nigh 11/20/2008 9:02 AM EST They got killed as crude rocketed higher, and again as it slumped to near $50. But that's about to change.
Oil Crude Is Due for a Bounce 11/14/2008 1:45 PM EST Dour fundamentals aside, oil has fallen too far, too fast not to see an upside correction.
Jim Wyckoff is a senior market analyst for TradingEducation.com a free educational Web site. In addition, Wyckoff writes a blog offering current market commentaries every morning on TraderBlogs.com. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Wyckoff appreciates your feedback; click here to send him an email.
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