Oil has broken out to the upside of what we called an awkward consolidation. This breakout will usher in a fifth wave move rather than a third wave. That just means that we’d look for a peak after the breakout move.
There is a little bit of resistance at $86 and at $91 (50% retracement) but the next strong resistance target is $100.
As we noted last month, the sentiment picture is confusing. Commercial traders are heavily short but this always hasn’t been a reliable indicator like it has been with Gold and Silver. A high commercial short position in Oil has only coincided with one major peak.
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