US Crude Oil At A Crossover: Support At $95.15 Levels

March crude oil futures have been a relatively tight $94.95 to $98.15 balance bracket for over the past month.

After trading near the $98.15 balance bracket high for three days last week, the market broke down on Friday and came within 30 ticks of the $94.95 balance bracket low. Additionally, during the Monday holiday yesterday , the market found balance in between a $95.15 support level and a $95.95 resistance level.

The term "GO/NO GO LEVEL" was coined by my mentor, Jim Dalton. Jim uses that term when a market reaches an important reference where the odds of a significant move, in either direction, are high. In this case, the lower extreme of the balance bracket is the GO/NO GO level.

When the market tests an extreme of a balance bracket, the 2 most likely scenarios are: 1) gain acceptance outside the balance bracket and accelerate or 2) trade outside the balance bracket and get rejected, which would likely begin a rotation to the opposite end of the balance bracket. An example of a GO/NO GO level was this past Wednesday, when the high of $98.05 came within 10 ticks of $98.15 balance bracket high. After a tight balance day on Thursday, the market broke down on Friday and came within 30 ticks of the balance bracket low. The failures at one extreme of balance lead to a quick rotation to the opposite end of that balance.

During four of the last seven trading days, the market has found support near $95.15. Additionally, below the $94.95 balance bracket low, there is a $94.80 to $94.95 gap. If the market trades below the $95.15 support level, it may test the $94.95 balance bracket low and that gap. If the market gains acceptance below the gap and breaks from balance to the downside, it may test the $93.67 reference, and evidentially test another gap below of $92.40 to $92.64.

The market has found resistance at $95.95 several times during the last seven trading days. If the market gains acceptance above the $95.95 resistance level, it may test the $96.86 to $97.07 gap above.