Crude oil is taking a bit of a breather after rallying nearly 40 percent from its low last month. And according to one technical-minded trader, the price action in the next few days will be crucial in telling whether oil can maintain its recent momentum.
Gordon's cause for caution relates to the correlation between the dollar and crude oil. "Over the last year, the dollar has rallied and the crude oil market has sold off quite sharply," said Gordon.
The U.S. dollar index is up 22 percent in the past 12 months while crude oil is down 45 percent in the same period. "But in the recent rally with crude, the dollar has been consolidating." This, to Gordon, is troubling, as he believes that unless there is a meaningful breakdown in the dollar, crude oil will not have enough fuel to continue its rally.