AAfter a downtrend throughout January to March 2015, WTI oil was consolidating between 44 and 54 USD a barrel. During that time, WTI formed a triple bottom signaling for a potential reversal to the upside. On April 7, the price broke out above the descending channel confirmed bullish sentiment.

Fibonacci indicator applied to the channel breakout point provided current support levels as well as a potential near-term target. Clearly Fibonacci levels were acting as support. In particular, the price bounced off the S4 (50.24), S2 (55.31) and most recently S1 (58.44). While S1 is holding, buyers should be dominating and WTI might target 0% Fibonacci at R1 (63.50)

Consider buying USOIL near S1 (58.44) targeting the area around R1 (63.50). The most recent support, S1, can be used as a protective stop loss level; although it is better to give a trade some room and place the stop loss slightly lower. A daily close below 58.00 could trigger further correction down, back to the point of the channel breakout – S3 (52.78).

Support: 58.44, 55.31, 52.78

Resistance: 63.50