Technically it is difficult to get excited about oil. OK there has been a 25 percent move from support near $78 a barrel to resistance near $98 in NYMEX crude. That's good for traders and a challenge for hedgers, but in today's markets, this rise is nothing to write home about.
It's the weekly oil chart that puts short term hysteria and hype into context. The last time oil moved above $100 was in February 2012 and that was a limited run to $110 that ended in May 2012. It was the last knee jerk reaction of a market that had failed to recognise the fundamental shift in oil pricing created by the shale oil revolution in the United States.
Major disruptions, civil, climatic and military do have a short term impact on price, but these impacts remain relatively small and they are constrained by the well defined support and resistance levels. With oil flowing from shale oil deposits, the U.S. is now a net exporter of oil.
(Read More: Oil Rally Could Fade If Fed Hints at Policy Pause)
The message is clear. The speculative money has moved out of oil in search of better risk and reward metrics.
The chart activity of NYMEX oil over the past two years shows a stable market with good support and limited upside despite revolutions in the Middle East, kidnappings and hurricanes. This is a market that has moved sideways for almost two years and chart analysis must recognise this behavior. This is a sludge market with slow moves.