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I noticed something about the chart of Oil that I wanted to bring to your attention. The chart is essentially sitting below the 50% retracement level on the fibs and just above multi-yr highs. Overall the chart is still in the bearish 20-60 RSI level and until it breaks into the 70 area I can’t get too excited, especially with a downtrend ATR. It seems my initial bullishness on this sector could be a tad bit early. I currently own one stock in this sector: SPN
The three things I’m watching for that will identify the next clear trend.
- Up-trending ATR, which would indicate strong interest in this commodity
- Trending ADX
- A breakout above the 50% fib level or a convincing breakdown below 10′ highs
