The volatility in oil prices has been significant over the past year and Sasha Cekerevac, contributor to popular financial e-newsletter Profit Confidential, believes that oil is about to break a key technical level that extends back to 2009.
In the article, Oil Prices at Crucial Technical Level
, Cekerevac highlights several important technical levels to watch for in the West Texas Intermediate oil market.
“On a weekly chart, oil prices are currently hitting an uptrend line that goes back to 2009,” says Cekerevac. “Technical analysis tells us that, the longer an indicator is in force, the more important it is.”
“The high in late February was an extreme level attained in the Relative Strength Index (RSI) for oil. In technical analysis, extreme levels of the RSI usually indicate a point at which oil prices have gone too far and a pullback is in order.”
Cekerevac believes that oil prices are forming a giant wedge. “The breakout from this wedge will be crucial in determining where the next leg in the market is.”
“If an attack on Iran were to occur, then that would seriously impact the oil market driving up prices on the fear trade,” the editor points out.
According to Cekerevac, the $95.00 level has been used as both support and resistance many times. “If oil prices
break below $102.00, we could see $95.00 as the next level of support,” says Cekerevac.
Cekerevac suggests waiting for this trendline to be broken before taking on positions.
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market...before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
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Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.