The trend breakout in NYMEX oil, first signaled by the Guppy Multiple Moving Average indicator (GMMA), has been confirmed. This is a significant trend change. Oil established a pattern of longer-term trend reversal with price oscillation around the $38 level, which formed a base for the rally to the next resistance level near $48. The next upside target is near $58.
Two barrier features on the chart acted to slow the rally from developing into a trend change.
The first resistance feature is the historical resistance level near $48. This resistance feature was strengthened by the proximity to the upper edge of the long-term GMMA which is also near $48 when the rebound rally commenced.
Both of these barriers have now been overcome. The upper edge of the long-term GMMA fell to near $46 and price has now moved above this level. Price has also moved above $48. Traders are now watching for a retest of these two resistance features to act as support features for any retreat.