Could Crude Oil Hit $70 Soon?

Since the Oil crash first began last summer, I have constantly been asked how low I think Crude Oil prices could go, and especially so the past few months. My answer has been pretty consistent, "I have no idea". To me there have been so many easier trades to be in out there that messing around with this disaster hasn't been worth the aggravation. As a market participant that has to allocate assets and manage risk responsibly, fooling around with crude oil has not fit our risk profile with respect to any potential upside. It just hasn't been there. Our clients over the past few months have received a road map for what we've wanted to see in Crude Oil before getting involved. One of these things was a rollover to new lows while momentum simultaneously diverged positively. Until then, this wasn't something we wanted to bother with. Well I actually think we might be getting that. Over the past couple of weeks Crude Oil prices have rolled over and are hitting levels not seen since early 2009, right around the time that the epic 200% rally first got going. I use a 14-day RSI as my momentum indicator and on these new lows in price, RSI is putting in a higher low. Here's what it looks like: chart 1 Since the Oil crash first began last summer, I have constantly been asked how low I think Crude Oil prices could go, and especially so the past few months. My answer has been pretty consistent, "I have no idea". To me there have been so many easier trades to be in out there that messing around with this disaster hasn't been worth the aggravation. As a market participant that has to allocate assets and manage risk responsibly, fooling around with crude oil has not fit our risk profile with respect to any potential upside. It just hasn't been there. Our clients over the past few months have received a road map for what we've wanted to see in Crude Oil before getting involved. One of these things was a rollover to new lows while momentum simultaneously diverged positively. Until then, this wasn't something we wanted to bother with. Well I actually think we might be getting that. Over the past couple of weeks Crude Oil prices have rolled over and are hitting levels not seen since early 2009, right around the time that the epic 200% rally first got going. I use a 14-day RSI as my momentum indicator and on these new lows in price, RSI is putting in a higher low. Here's what it looks like: