Light Sweet Crude The CL contract fell again on Monday, but managed to rebound in the latter hours of trading. Because of this, we have now formed a bullish hammer at the $92.50 support level. This area could turn out to be rather important, and any medium-term bullishness could come from this area. If we break the Monday highs, it is a good buy signal for a short-term trade. If we break lower – $90 will be tested. Brent The Brent market didn’t fare as well as its Light Sweet Crude cousin, and finished the day very weak. We are still sitting just above a cluster of support, so this won’t mean much – but it should be noted as it diverged from the price action in the CL market. We still see the area as supportive, but we are currently waiting on some kind of bullish candle in order to buy. Crude Oil Daily Fundamental Analysis for June 21, 2011 Crude oil prices rebounded on Monday to the upside, albeit mixed feelings dominated markets, where pessimism continued to dominate markets over the European debt crisis, however, rising metal prices weighed down on the U.S. dollar, while the huge drop in crude oil prices over the past period also spurred buying crude oil, which sent prices to the upside. We still preserve our bearish outlook for crude oil prices, where the huge uncertainty surrounding the outlook for global growth should continue to weigh down on crude oil prices, as investors are concerned over the outlook for demand on oil, while rising risk aversion in markets should also weigh down on prices. Tuesday June 21: Also, the focus will be on Greece with the confidence vote in parliament. A no vote of confidence and the restriction of the austerity measures will be very negatively violent on the market, as investors will surely start to price in a possible political vacuum with early elections and most importantly eminent default, as the bailout and funds from the EU and IMF depend on the measures to pass. At 2:30 GMT, Canada will release the leading indicators index for the month of May, where the leading indicators expanded by 0.8 percent back in April. At 12:30 GMT, Canada will also release the retail sales index for the month of April, where retail sales are expected to rise by 0.7%, compared with the prior flat estimate, while retail sales less autos are expected to rise by 0.5%, compared with the prior drop of 0.5% in March. At 14:00 GMT, the U.S. will release the existing home sales index for the month of May, where existing home sales are expected to drop by 4.0% to an annual rate of 4.85 million units, compared with the prior estimate of 5.05 million units. The natural gas markets had a neutral day on Monday, and perhaps this is best. The recent sell off has been brutal, and a bit of a bounce wouldn’t be out of the question at this point. However, buying is going against too much selling pressure for us to be comfortable. Selling rallies is a preferable strategy, and we will be looking for bearish candle formations above this level.

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