From the Desk of Ian Culley @IanCulley
Black Gold is breaking out!
Crude oil is flipping weeks of indecision into conviction following a hard retest that frustrated traders earlier this month.
Let’s take a look…
Check out crude’s upside resolution to fresh five-month highs:
Yesterday marked the completion of a tight bull flag – a typical characteristic of an uptrend.
The path of least resistance points higher toward our 95 target.
However, I would be remiss not to mention momentum. The 14-day RSI has yet to register an overbought reading above 70.
This isn’t an immediate concern. But if the crude oil rally does have legs, momentum will reach overbought conditions. In fact, the energy sector's recent performance is showing no signs of stress.
The Oil Refiners ETF $CRAK is trading at all-time highs, and the Energy Sector ETF $XLE isn’t far behind. Plus, energy stocks are popping up everywhere on our bottoms-up scans—from the International Hall of Famers to Freshly Squeezed.
It’s not just oil and gas names. Natural resource stocks are ripping through our breakout levels, and the Materials Sector $XLB is also posting new all-time highs.
Commodity-related areas of the market are on fire!
In the Trade of the Week, I’ll outline two commodity stocks triggering buy signals.
Happy Easter.
-Ian
We'll be back next week with an updated COT Heatmap and Commodity Chartbook.
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