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Crude's Trend Line: Third Time's A Charm?

Published 05/10/2013, 11:40 AM
Updated 07/09/2023, 06:31 AM
GC
0.31%
CL
-0.48%
ENERC
0.00%
ACT
-0.24%

Crude oil (CL_F) has been rising over the last few weeks and I thought it’s time to check back in with the black-gold commodity. In April I wrote about how light crude oil was testing Fibonacci support at $86 while sentiment data continued calling for potential weakness. It seems the bulls were able to hold support and crude has rallied 12% back above $96/barrel.

The Line
The energy commodity now sits just under the falling trend line that’s batted down previous rally attempts going back to 2012. This trend line -- as well as the previous closing high at $99 -- are where buyers are likely to set their scopes. As often said, the more times a level of resistance (or support) is tested the more likely it is to break. We can’t know how many times it must be tested, but if crude can catch a few more bids we might get our third chance at higher oil prices. I’m not writing to be bullish or bearish on oil, but I will be watching these two levels of resistance and see how price reacts. As always, let price action dictate our bias.
Light Crude
Disclaimer: Do not construe anything written in this post or this blog in its entirety as a recommendation, research, or an offer to buy or sell any securities. Everything in this post is meant for educational and entertainment purposes only. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer. Connect with Andrew on Google+, Twitter, and StockTwits.

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