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Breaking News:

Guaido Takes Strides To Topple Maduro

Are we About to See a Buying Opportunity in Oil

Despite the recent weakness in Nearby Crude Oil on the daily chart, the weekly and monthly charts are showing quite a bit of resiliency. Both of these charts suggest the market may be in a position to breakout to the upside which could be the reason why traders are coming in to support the market on short-term sell-offs.

Fundamentally, gains seem to be capped by high inventories, but the continuing improvement in the U.S. economy coupled with a spattering of geopolitical events have helped maintain a strong uptrend.  The recent sell-off in crude oil from late June to mid-July was met with strong buying which has the market poised to begin August within striking distance of a breakout to the upside.

Technically, crude oil has been trading inside a powerful triangle chart pattern with a strong upside bias. This chart pattern tends to indicate impending volatility. Since bottoming in January 2014 at $87.26 the market had produced five consecutive months of higher-highs until it reached a level of $107.50 in June. At that time it traded to the bullish side of the triangle, but the volume wasn’t there to support a breakout.

If you recall, that breakout rally was fueled by geopolitical events in Iraq, but the high supply and the easing of tensions made the high price attractive to hedgers, leading to a corrective break in July. This month, buyers came in to support the market on a pull-back into a pair of 50% support levels at $98.85 to $97.38.…




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