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Around 60-Days ago the Power of the Pattern suggested that the "most important commodity on the planet" should be on its way to $70 zone if the bottom of the pennant pattern broke support. (Post Here)
Well 64 days later Crude Oil has broken the bottom of the pennant pattern and Crude has hit the $70 target level this morning! Above you can see that two "potential support" points (channel support and Fibonacci 38%) meet at the $65 zone.
I have been suggesting to members two things over the past few months. Crude Oil should be shorted and it could reach these levels and it would end up impacting the stock market in a negative way. I have been right on the trade and so far very wrong on its global impact.
Joe Friday says.... If support line dating back to the late 1990's doesn't hold, the next important channel support for Crude comes into play around the $35 level.
In my humble opinion, this is not only a critical support test for Crude, its a test for the macro picture as well! Should Crude bust through support and find itself working toward the $35 level, I would be shocked if it doesn't end up impacting stocks in a negative way and send a message, that the world is slowing down.
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