Long-term outlook:
NYMEX WTI prices are still making higher highs and higher lows and thus may reach $90 or even $100 in the first quarter of 2010. However constrained price action in the second half of 2009, when the rise was laborious and the uptrend was flatter, combined with the dynamic new uptrend in the Dollar Index question the ability for WTI prices to continue much above $100.
COMEX Gold is currently in a corrective decline after a surge to record highs. As the precious metal has tended to be leader in terms of long-term direction in the past (see page 5), it will be on the energy trading radar screen in 2010.
Short-term outlook:
Daily chart, February WTI futures (CLAG0):
Today’s hesitant price action as the market made a new recent high is questioning the immediate upside potential. For now, however there is no immediate sell-signal and as long as CLAG0 remains above 80.70, the next objective is a challenge of 82.00, then a rise towards next resistance at 82.28, then 83.19.
Invalidation: a close below 80.70 would signal a test of support at 80. If this level gives in, next support will be the 78.66-78.80 area.