Nearby NYMEX oil experienced a deep retracement of yesterday's upmove from 97.40 to 100.24. This morning's low at 98.25 followed by an upside pivot and rally to 99.20-plus preserved yesterday's low as well as its up-leg, which itself exhibited bullish form.

If my work proves accurate, then today's deep retest satisfies a completed correction of yesterday's up-leg, and as well initiates a new up-leg in oil and the U.S. Oil Fund ETF (USO). The up-leg should hurdle near-term resistance at 101.20/25 on the NYMEX chart on the way towards testing the January high at 103.74.

 

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com.