Late January saw Crude Oil briefly dip to new lows, likely scaring out several already weak hands and another handful of bottom traders. That set the stage for last Friday’s rally and my post on Crude Oil’s Lonely White Candlestick. But that wasn’t the end of the Oil price volatility.
After the short covering rally carried Crude Oil all the way up past $54 per barrel on Tuesday, it immediately cratered back to $47 by last night, as if someone let the air out of a balloon. My first thought was: “wow, what a turd.” My second thought: “that’s just Crude being Crude”.
And if that wasn’t enough oil price volatility, Crude rallied back to $52 by late morning… which triggered my third thought: “Crude just plays when Crude wants to play.”
Okay, all kidding aside, what’s the takeaway here?
Well Crude may be attempting to push the trade a bit higher. Between January 1 and today, Crude has been rangebound, with the recent rally attempting to carve out a rounded bottom. We’ve also seen an uptick in Crude Oil price volatility which could be its way of shaking out some weak hands for a continuation of the countertrend move. This is not a call, just simply an observation. But for Crude Oil to rally a bit higher, it will need to take out this week’s highs. It’s currently trading at just over $50 per barrel in afternoon trade.
Crude Oil Futures – March 2015
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No position in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
