In my post of the 28th March, I suggested that we were seeing a strong platform of price support develop in the $57.80 per barrel area, and if this held then the key $60 per barrel level could be tested and breached in due course. This has in fact been precisely how the price action has played out, with the WTI contract moving firmly through this level, and now trading at $64.12 per barrel at the time of writing and looking to extend its bullish run further. Yesterday’s price action on the daily chart was certainly confirming this with excellent volume under a widespread up candle and showing no signs of weakness for the time being. Note the trend monitor for NinjaTrader confirming the bullish sentiment which remains firmly in place.
In terms of longer-term targets for the price of oil, the weekly chart gives a handy perspective, and the key level here is at $68 per barrel where the volume point of control awaits. As the deepest region of volume, we can expect oil to pause and congest at this level before moving higher to test the $71.80 per barrel region in due course. In terms of price resistance to the move higher, we only have minor areas at $66 per barrel level on the accumulation and distribution indicator, with a further level at $71.60 per barrel. Again considering the move from a VPA perspective, we have rising volume over the past few weeks confirming volume and price are in agreement.