Crude futures continued their ascent as U. S. equities shot up nearly 7%. Crude has reacted as expected after closing above the psychological $50/bbl and our 2nd tier downtrend line earlier this week.

Despite the gains, the movement was calm considering the furious rally taking place on Wall Street. Perhaps crude futures are reaching overbought levels with 2009 highs approaching. With a lack of economic data from the U. S. today, crude investors are focusing on the incoming manufacturing PMI data from the EU.

Higher levels of manufacturing yield greater consumption of crude during the production process and imply improving consumer sentiment, and falling manufacturing levels imply the opposite.

It seems crude futures will need surprisingly positive production, manufacturing, or inventory data to catapult above January highs and the psychological $60/bbl level.

For the time being, we wouldn't be surprised to see some profit taking in crude, especially if data from the EU fails to meet expectations. Regardless, the uptrend remains comfortably intact.

Fundamentally, we find supports of $53.30/bbl, $52.69/bbl, $52.36/bbl, and $51.87/bbl. The $50/bbl is a psychological cushion while $55/bbl serves a psychological barrier.

To the topside, we hold our resistances of $53.77/bbl, $54.52/bbl, and $54.9/bbl with fresh top-end hanging at $55.45/bbl. $55/bbl serves as a psychological barrier and $50/bbl acting as a psychological cushion. Crude futures are currently trading at $53.45/bbl.

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