Crude oil has been somewhat schizophrenic since March 2020. As we all know, the May oil contract crashed and went negative on April 20th, 2020. This is the first time that something like this has happened in history. Since that crash, crude oil has been steadily climbing higher on the charts. Oil is currently being helped by production cuts from OPEC and Russia. Recently, economies around the world have begun to open up and this is certainly causing demand to rise. Should more industries such as the airlines begin to ramp up it will also increase demand for refined oil products.
Currently, the July oil contract (CL-N20) is trading around the $33.00 area. This level should serve as near term resistance for oil since it is trading into a gap window from early March on the continuous contract chart. It will now be important to see how oil reacts at this resistance level. Should crude trade sideways over the next week or two it will likely be setting up for another move higher. The next important resistance area for oil will be around the low $40.00 range. Traders will now have to keep an eye on that pattern that is forming going forward.