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Over the past few days, oil has had two bounces off the $50.00 level. Little ones. Nothing all-too crucial.

I'm thinking that the potential for some buy orders sitting at that level is probably high. Personally, I don't believe too much in technical analysis. I can't remember the last time the U.S. economy did a double top, tea cup, or head and shoulders. The economy moves for economic reasons. The markets move for those very same reasons.

But, I do believe in temporary psychological levels, and I also believe that there are enough people out there that believe in technical analysis that for short-term reasons, there is value. So, I keep close eyes on trends and levels to help my timing of trades.

That being said, the $50.00 level looks to be a very important psychological level that will likely see some bounces. If, and when, as I firmly believe barring any unforeseen geopolitical event, oil will definitely be in the 40's long before the doomsayers ring true with their $100.00 calls. Once the $50.00 level goes, I think it has a tremendous amount of psychological ability to be a ceiling.

Oil Price

Source: Oil Bounces Off $50, But Should Soon See $40's