The USO recently broke out above the $40.00 resistance level on the daily chart. Today it pulled back to the $40 level intraday and then began to trade higher again. All oil did was simply backtest the breakout range. Many stocks and ETF’s do this after making a new high. Remember old resistance becomes new support. It also helps that the trend is still up and the trend is in your favor. Therefore you buy the $40.00 level and place a stop at break even or in the money once the trade is profitable with a stop just below the $40 level. Watch for this intraday as it presents a very good risk/reward set up.
