Wednesday, October 13, 2004

A rather slow economic news day, so here's some raw meat to keep you all happy.
Signals are growing that oil's price surge could push all the way to $70 a barrel, according to the technical analysts who forecast market trends by interpreting chart patterns.

Crude's 60 percent run-up this year to $50 record highs has been driven in part by fund investors who use chart signals to guide many of their big-money bets.

With prices now in uncharted territory, technical analysts say the blistering rally shows few signs of slowing and suggest prices could peak at $70 - nearly $20 above current prices. . . .

Phil Roberts at Barclays Capital said the longer NYMEX crude stayed above $47 a barrel the more likely it would become that the market was in the build up to a "classic commodity spike, suggesting $75 as a possible target."

All trend-following systems were positive, with no trend-ending patterns to lean against once the August high was breached, Roberts said.

"Against this backdrop we are wary of further near term gains and view dips as buying opportunities," he said. . . .

Analysts said downside risk was likely to be limited with Brent likely to find good support around $46 and NYMEX crude ahead of $50.

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