Crude oil futures are volatile enough on a normal day, but with rumors of a Russia/OPEC February meeting to discuss production cuts, it’s really volatile now.
As far as I can tell, the meeting and/or production cuts are currently an unfounded rumor – so we’ll wait to see if there is actual confirmation of this buzz. Nonetheless, the crude oil rally has continued into this week.
Note that buyers came in after a capitation-like move down to my long term target of $27.01 on January 20th, 2016.
If crude oil prices continue to push higher, the question is how high will this crude oil rally go ?
No one truly knows where the price of anything is going, but as a technician, I can share my calculated best guess with you. Those of you that are familiar with my style know that I normally give a price target and two levels of support or resistance. In this case, we’re looking for resistance.
I’ve identified four levels of resistance, all within a $4.19 range . I’ve highlighted that range on the chart below. If the crude oil rally reaches this price resistance zone, I’d expect a pullback there.
Crude Oil Futures – 1 year, daily chart
Thanks for reading and remember to always use a stop.
This post originally appeared on See It Market