Breakout in Crude Oil
WTI crude oil just completed an impressive trading session to wrap up a notable week which saw ‘black gold’ rally ~4%. From a technical perspective crude oil is now in a 4-month uptrend which has been steady and gradual in its ascent (with plenty of pullbacks along the way):
WTI Crude Oil (Daily)
The week began with a ‘golden cross’ (50-day moving average crossing above 200-day moving average) and ended with a bang. Today’s 2.4% rally was the first time in a while in which buyers were almost in a panic to get long crude oil. I believe this is especially noteworthy given the fact that sentiment on oil is fairly muted with most market commentators believing that the rally won’t last long and some even being quite vocal about $55/barrel being a ‘ceiling’ for WTI.
Whenever price is moving contrary to the conventional wisdom it is especially significant; this appears to be the situation in the crude oil market right now.
Oil related equities also finished the week strong with the $OIH (Oil Services ETF) printing a bullish engulfing candlestick on the heaviest volume in months:
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