Weekly 
Zooming out from our usual daily-chart view to monthly and weekly shows that on a monthly basis, the Percent R for WTI has rolled over from an overbought position. The last time this occurred the price move was significant, the risk to the downside at this point is likely ~10/bbl to the 6500-6000 region. However, the weekly continuation chart above suggests that there may be some support at 7000 based on trend line support extended from points 2 through 3. A break below 7000 would be needed to confirm the monthly Percent R signal.
Jan. 29 (Bloomberg) -- Commodities headed for the biggest monthly drop in 13 months on concern that demand may wane as governments seek to control economic growth.
The top chart above shows clearly how 7400 provided consistent support from late Fri through to early trading today. Even after the EIA data was released, that support level held firm, giving market momentum to bounce to 7500 resistence. However, at that point there was little motivation for the buy side to push price higher: the EIA products data were bearish; equities were weak; and the USD was strong. When price reached 7400 support for a second time today it lingered only 10 minutes before trading off strongly. Although price did retrace 2/3 of the breakout lower, expect 7400 to now represent new resistence.
Stocks mmbbls
Jan. 23 (Bloomberg) -- Concern that short-sellers accelerate stock declines may prompt the Securities and Exchange Commission to adopt a rule next month aimed at curbing bearish bets when equities are plunging.
This week WTI traded a Three Black Crows candlestick formation Wed thru Fri, after trading a head-fake bull trap on Tue. Price action suggests more weakness in the week ahead, but possibly not as aggressive as this week, 7200 should provide some support. If this level is broken, then ~6900 represents next significant support. Care should be take on the bearish side short-term though. The USDX actually closed marginally lower on Fri, which is not entirely supportive of the bearish view for equities and commodities. Technically, while there may be room for more downside on WTI, the Percent R oscillator is indicating an oversold condition, suggesting a pause/reversal near-term is likely. Trader commentary noted that equities volume last week did rise relatively with the fall in prices, but not enough to suggest a massive correction is underway - yet.
A return of 'normal' winter weather to the US NE has lifted HH from 540 support through recent 580 resistance. Another large draw on inventory levels last week has placed stocks well back within the five-year range. Seasonally, the market is beyond the midpoint of the 2009/10 winter season, so, barring aggressive extended cold weather, any price rises should be transitory, with traders/analysts estimating what stock levels will be at the end of this heating season - providing either a bearish or bullish skew, depending on stock forecasts. 600 should represent moderate to significant near-term price resistance.
Jan.18 (FT) Aidan Heavey, founder and chief executive of Tullow, the UK’s fourth-biggest oil company, says his decision this weekend to pre-empt the $1.35bn (£826m) sale of Heritage Oil’s Uganda assets to Eni, the Italian energy group, was all part of a normal day’s business.
