For today's chart we've chosen to take a look at the continuous futures contract on Light Crude Oil rather than a stock like we usually do. The reason we have chose this chart is because oil has recently fallen below an important support level, which will likely affect the short-term direction of the markets, as well as many oil- and gas-related equities. As you can see from the chart below, the price of oil has slipped below the trendline in the past, but it has never consecutively closed three or more times below the trendline like it did this past week. We now expect the broken support near $68 to become an area of short-term resistance that could prevent oil prices from heading higher.



OIL_091306.gif

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