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Crude Oil; Two Thirds Odds Of Breakout, Target $70

|Includes: The United States Oil ETF, LP (USO)

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Crude Oil has created a series of lower highs and lower lows since the peak in 2008. Since the lows of 14-months ago, Crude has created a series of higher lows and potentially creating a bullish ascending triangle pattern. This pattern two-thirds of the time, leads to an upside breakout. Below looks at a chart Crude Oil, with a focus on the potential ascending triangle pattern.

CLICK ON CHART TO ENLARGE

For the read to be correct, (Bullish Ascending Triangle), resistance at the $55 level has to be taken out. At this time the $55 level comes into play as stiff resistance.

This ascending triangle pattern allows one to do a measured move calculation. The height of the ascending triangle is measured at (1). If a neckline breakout takes place, the measured move suggests that Crude could rally to the $70 zone at (2).

A breakout has NOT been proven at this time. The key to this pattern; Resistance must be taken out! If it does breakout, Crude could well attract buyers.

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Disclosure: I am/we are long XLE.