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What Next After Oil's Intraday Plunge?
By Mike Paulenoff, www.MPTrader.com
The US Oil Trust ETF (NYSE: USO) has plunged over 6% from its early morning rally peak, which is not a surprise from a volatility perspective, but it is a surprise to me IF I thought that a more bullish pattern was under development. In other words, the plunge in the USO has taken back too much of its prior rally to be considered the start of a new bull move. The entire upmove from the Dec 5 low at 33.08 to this morning's high at 40.73 likely completed the initial rally phase of an intermediate-term period of oil price recovery. If my work proves correct, then somewhere in the vicinity of 36.90-37.10 the USO should stabilize and pivot to the upside for another loop up towards 42.00-43.00.
