Thursday, January 6, 2011

Trade Update: OIL

The 52-week chart of OIL looks fairly jagged. The price seems to be consolidating between roughly $20 and $28. However with the National Inflation Association predicting five dollar per gallon gasoline the break above $25 on spiking volume seems compelling.

I tried to keep the stop close enough to prevent a serious loss and still far way from the noise of the consolidation. So, I chose a point below the $24 support level which is also below the 40 day moving average.

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