Long-Term Support and Trend Considerations
Crude oil could pull back all the way to the channel breakout area around $69.00 and still maintain the long-term trend reversal pattern. However, there are certainly higher price areas worth watching for signs of support. A key initial dynamic support indicator is the 200-week moving average. This is due to its long-term nature and that it was clearly recognized by the market as both support and then resistance over the past couple of years.
There is also the neckline of a large double bottom pattern at $78.44. Once prior resistance shows as support, another bounce may follow. Also, a daily close below either the neckline or 200-week average, would show short-term weakening and may lower the likelihood of testing upside resistance areas again.
