Weakness in nearby NYMEX Crude Oil has continued beneath my original target zone of 93.80 into a near corrective low of 92.52 so far.

Once again, my 4-hour RSI momentum work has registered a downside NON-confirmation of today's new reaction low, which is our first warning sign that perhaps the oil price slide is nearing completion.

That said, my optimal next target zone for the conclusion of the post-November 17 corrective process is 92.10-90.30. In that today's low has not yet entered the optimal buy zone, and given the fact that the technical set-up only has registered an initial divergence that likely will require two or three prior to the establishment of a significant corrective low, my sense right here is to be patient for lower lows in the upcoming hours prior to consider entering long positions.

Finally, and importantly, we must also consider the continuing high correlation across markets and asset classes before entering a long oil or U.S. Oil Fund ETF (USO) position. Right now, both dollar strength and equity weakness remain "unfriendly" to oil prices -- an influence not to be underestimated heading into the final two weeks of the year.

 

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