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Although oil prices are up about $1/bbl this morning, given the juxtaposition of the dollar index pressing against its October low (see our comparison chart of oil and the dollar), a holder of long positions in oil and the US Oil Fund ETF (NYSE: USO) could be disappointed. That said, I am also mindful of the fact that Friday's weakness can be construed as a successful test of critical support at $76.55, and as long as $76.55 contains any forthcoming weakness, the near-term pattern in oil argues that a three-week bull flag should thrust to the upside in the upcoming sessions – towards a target of $86-$88.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
