Jul 162012

CL 09 12 (1 Min) 06.17.12

7/16/2012 Monthly Retail Sales (0230 HI time / 0830 EDT)
Core Forecast: 0.1%
Core Actual: -0.4%
Previous revision: n/a
Regular Forecast: 0.1%
Regular Actual: -0.5%
Previous Revision: n/a
Started @ 86.88
1st Peak @ 86.80 – 0231 (1 min)
8 ticks

Reversal to 87.02 – 0234 (4 min)
22 ticks

Notes: Report was strongly negative, falling short of the forecast across the board with no previous report revision. Empire State Manufacturing broke at the same same and was moderately positive. Normally the aggregate of bearish news would cause a strong short move, but 2 factors prevented that. 1) There was strong support in the 86.80 area that had been tested several times in the previous 12 hrs without failing, and 2) the news was so negative that the dollar fell precipitously for 30 minutes thus mitigating the bearish sentiment on oil. With JOBB you may have filled at the lower limit or missed the spike by 1 tick with slippage. In either case, when it fails to shoot downward after the initial drop, close out. The reversal reclaimed 22 ticks in 4 min, bouncing off of the 86.80 level and stalling just above the 200 SMA after crossing all 3 major SMAs. As the dollar continued to fall for an hour after the report release, we saw a rally on the CL for nearly 100 ticks coinciding.