Crude-oil futures are showing some signs of life, having rallied from just under $44 to test the $50 level in the just the last couple sessions.
So what does this mean?
Although the bigger picture bias and large degree trend will remain pointed downward while price is under the 55.00- 56.76 resistance zone, the near-term is suggesting that a test of these nearby resistance zones is likely underway. With price above 47.92, the short-term bias points toward further correction. The important nearby resistance levels to pay attention to are 51.27, 53.08 – .78 and finally 55.00 – 56.76. On any continuation of this bounce, these are the levels that we would look for price to gravitate to.
What’s the signal that the bounce is over?
Currently, if price moves back below 47.92 it would suggest that price is returning to a near-term rotational or consolidation state and target a test of 45.42 or lower support at 43.58 – 44.20. Any move to new lows would signal a continuation of the larger downtrend and a new leg lower.
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