Thursday's downward trading of oil brought some relief to the equity markets. Don't expect the decline to last. Technical models are indicating short-term downward pressure until the end of April. As May unfolds, increasing upward pressure should return. The first level of support is at $110 followed by solid support at $100.
Bottom line: The selling pressure in crude oil prices is expected to be brief but swift with good support levels close to current prices. Look for for oil to move back to $120 in May. The near term target is $127 with $134 as the upward target in 2008.
By Donald W. Dony, FCSI, MFTA
www.technicalspeculator.com
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