The oil market is still trying to figure out a direction. On the upside, we are moving into the summer driving season, which is typically a period of rising oil prices. However, with retail gas prices still near $4/gallon and the economy slowing, traders are also aware that gas can't go much higher without killing US demand. At the same time, developing markets are providing a demand floor; as their respective middle classes have grown, so has their respective oil demand. As such, there is little reason to see a significant price decline -- hence, the reason I thing 96 will provide support going froward.I have provided similar analysis for the last few weeks. Nothing has occurred on the chart to change my analysis this week. Consider this chart:
Prices are still bounded by the two boundaries of roughly 97/98 and 104. The analysis above still provides the overall macro analysis.
Same analysis, different week.