Wednesday, November 05, 2008

Three similar graphs

Take a look at these three graphs ( open in new windows separately)


Crude oil

Dow Jones Industrials

All these three graphs have a few things in common.

- MACD has given a crossover from very oversold levels.

- A double bottom is formed in Dow Jones on a daily chart, crude oil on a 240 minutes graph and copper on an hourly graph.

- Dow Jones is nearing its short term resistance level and RSI is getting into a congestion zone; Crude oil has formed a bullish engulfing pattern with a strong break on the RSI; copper HG has tested $1.78 three times in the last three days

There is a possibility of a significant rally in crude oil and copper as i mentioned in the last crude oil post. Short term resistance level of $72 was the top yesterday and $76 may see some more profit booking.

Copper is looking set to touch $2.08 and $2.25 after that breakout.

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