Checking Back in With Crude Oil

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 calling for potential continued weakness. It seems the bulls were able to hold support and crude has rallied 12% back above $96/barrel.

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 we 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.

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