Crude made an important breakout of a symmetrical continuation triangle today in confluence with a break of the 200 period EMA. Based on this reliable chart pattern and important resistance area, crude is headed higher.

Below is a weekly chart of crude. You can see a clear break out of the triangle and above the EMA, all on rising RSI. This is a very bullish chart for crude oil. A break above 83.19 would signal a long term uptrend in crude oil. Also note that PSAR (parabolic stop and reverse) flipped on todays action.

The daily chart shows a strong breakout, with some resistance at $82, which should be easy for crude to break. There is also potential for this chart to form a bullish flag.

Crude Oil Price Forecast

Based on the continuation triangle and the possible bullish flag, I would set profit targets on crude oil between $93 – $99. A break above 100 should be met with strong psychological resistance.

How Will $90+ Crude Effect the Overall Economy
Recently, I wrote an article that compared the price of crude oil against price movements in the S&P 500. There is as astonishing correlation between the high and lows in crude oil prices, and reversals in the broader markets. The chart clearly shows that $90 crude oil can kill an economy.

It is important to track the price of crude oil as it has a direct impact on the stock market, and hence your trading. Even if you don’t trade crude, understanding how the price of oil impacts other markets is critical to trading profitably.

I highly recommend following the free crude forecasts provided by Joesph Raia on Ino.Tv, as well as the Dan Gramza daily market technical analysis and setups. They’re a great way to get insight into each trading day, before the market opens.

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