Thursday's Market Minute: Oil Breaks Above 70

Crude Oil futures hit their highest levels since October 2018 during Tuesday’s postmarket session, breaking above the 70 mark. Will bulls step in to continue the uptrend after oil’s swift rise? The /CL contract surged more than 12% in the past three weeks, logging nine green candles during the past 13 trading days and climbing above the boundary of an upward channel that’s been in play since early April, as well as an often-tested resistance zone from 66 to 67. Momentum also is on the move upward as the RSI continues rising into new recent highs along with price, although it stopped short of generating the typically bullish signal of moving into the overbought area above 70.

If prices continue to climb, the yearly Linear Regression 50% Channel’s upper boundary is near 71.95. Looking back further, /CL’s climb during 2018 climaxed with a double-top pattern near 75, so this could be another key point. To the downside, the Volume Profile study shows a node (area of heavy trading activity) near 68.90 with the next spike near 65.30, so look for potential stalls in falling prices near these areas. Other levels to watch include the 21-day Exponential Moving Average around 67.25, and the yearly Linear Regression Line near 66.60 – right in the middle of the previously mentioned resistance zone.

Image by James Armbruster from Pixabay