Weekend Analysis for April 22nd, 2006

Despite the continued rise in the price of Crude Oil the major averages rallied this week although most of the gains occurred on Tuesday. A longer term chart of the price of Crude Oil shows that it has been holding support at its 40 Weekly EMA since the late part of 2003 while remaining in an up trend. Meanwhile this week the price of Crude Oil rose above a significant resistance area near 70 and it looks like this could lead to a move up to the 80 level at some point. As we have seen in the past when the price of Crude Oil has made a significant move higher this has generally had an adverse affect on the Dow. Thus if we see another extended period of higher Crude Oil Prices with the price of Crude Oil eventually rising into the 80's this would likely have a negative affect on the Dow.

Our complete Market Analysis for this weekend can be found at
http://www.amateur-investor.net/Weekend_Market_Analysis_April_22_06.htm