My work in nearby NYMEX oil argues that current weakness should violate Friday's low at 97.65 on the way to a press into the 96.00 area, where the price structure should make an attempt to hold and pivot to the upside, preserving the late-Nov double-bottom lows around $95.00.

If such a scenario unfolds, then oil and the U.S. Oil Fund ETF will enter a powerful new up-leg that projects to $106-$108 thereafter in NYMEX crude. Only a sustained violation of $94.65 will invalidate my preferred technical scenario.

 

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com.