Sep 062012

CL 10 12 (1 Min) 09.06.12

9/6/2012 Weekly Crude Oil Inventory Report (0500 HI time / 1100 EDT)
Forecast: -4.9M
Actual: -7.4M
Started @ 97.36
1st Peak @ 97.71 – 0501 (1 min)
35 ticks

Reversal to 96.83 – 0509 (9 min)
88 ticks

Notes: Large loss of inventory when a lesser loss was expected caused a moderate long spike for 35 ticks in 1 min that could not go higher or sustain the rise due to the very short term overbought condition in the market. With the R3 looming about 20 ticks above the top of the wick, even the bullish report could not motivate the bulls to keep buying. With JOBB, you would have filled long with minimal slippage at about 97.47, then had an opportunity to close out with about 17 ticks as it hovered just below the top of the wick for about 6 seconds. The market was already trading above all 3 major SMAs at the report release and strongly higher than the R2 Pivot. After the spike on the :01 bar, it reversed strongly for 88 ticks crossing the 100 and 50 SMAs in 8 min. Then it tried to muster the bulls for another rally, but barely eclipsed the 100 and 50 SMAs before succumbing to the resistance.