The November 14 crude oil contract rallied back higher in Tuesday’s trade nearly erasing all of Monday’s losses to settle at 91.56, up .69.
The 10 day moving average at 92.00 today held as resistance in yesterday’s trade as well as in the overnight session. This average needs to be broken as resistance to turn the near term trend back up.
A breakout above 92.00 would turn the upper trend line of a triangle pattern that has been forming at 93.90-94.00 into the next upside resistance.
If upper trend line resistance is reached and holds, it would be the fourth and final point of the triangle. Triangles have a 75% chance of being a continuation pattern rather than a reversal pattern.
In this case, this triangle if it forms as predicted should be a bearish pattern.
A drop under Monday’s 90.41 low or a rally above 94.00 would negate the triangle pattern.
Technical Indicators: Moving Average Alignment – Bearish
Long Term Trend Following Index – Bullish
Short Term Trend Following Index - Bullish
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