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VIDEOLight Sweet Crude: Sweet Possibilities
The key: Look out for the strength of the support.
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After a nice run-up, is it really a surprise that crude is down this morning? I've been tracing the path of crude since March 10 , first on the short side, and since March 12 on the long side.
The key here would be to look out for the strength of the support. Looking at an XOIL chart, buyers, who missed the breakout from lateral resistance, might be lurking at those breakout levels.
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And watching the same move in USO, $29 would be an ideal entry point on a low-volume pullback. (Take a look at USO Too Slippery to Hold? for more on this stock.) It should find support at lateral trendline, confluence of 50-day moving average (not shown) and the 20-day moving average - and it will also remain in the top half of the Bollinger Bands, yet another demonstration of newfound strength.
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