Oil has not done much during the past month of May. Looks like a consolidation phase that normally breaks out in the same direction as it was entered, in this case down. A “logical” target , as a minimum, would be about $86 from where the most recent climb started. Also that would represent a pull-back of about 38% of the entire rise from the low thirties level. It may take another week or more to complete the consolidation phase.
Yesterday’s announcement by Germany that it will discontinue nuclear power generation some 15 years earlier than previously thought, brought the stock down by about a dollar and it is possible that a diagonal 9 as shown) could form. However, it is not clear how they will pull this off and some cynics conclude that it is little more than posturing to get the Greens on side on another Greek support proposal. I do not think a diagonal will form, but it could.
On second thought we would sell above $ 6 , simple because this COULD be a simple A-B-C. However the stock should go higher yet but it is hard to resist a 40% gain.
No big surprises here, other than the tenacity to stay up there. Maybe things are starting to move, it has left a little island hanging up there in thin air. The main problem , for the moment at least , is that it cannot grow!