Oil Ready to Rally

By -

Oil fell pretty much nonstop from October 3rd until November 23rd. At that time, I pointed out the magenta horizontal (shown below) as well as the blue descending trendline, each of which I felt would act as support. So far they seem to have done so, and as rapidly as oil fell, the “bounce” could be just as swift (although certainly not with enough power to recover all those losses).

slopechart USO

Taking a deeper look by way of the Commodity Channel Index, you can see how we are getting close to a positive crossover. Nothing in trading is guaranteed, but as you can see from prior instances, these crossovers certainly tend to precede meaningful price rallies.