After oil accelerated from near zero last year, it reached $85 for the first time in 7 years. A few things are really interesting on the chart. I would have expected the purple relative strength to have a lot steeper slope. The second interesting point is that the PPO showing momentum is currently making lower highs but is at the trend line now.
It has been an exceptional run. The real question for everyone now is can new money go in here. While all of the inventory tightness are still in play, perhaps we can add more there. It seems a tough trade.
Other commodity areas that are starting to improve include Corn, Soybean and Wheat.
I also like the precious metals here. Both of these charts are breaking their weekly downtrends.
As nice as crude oil looks, these five other commodity charts also look like they have some significant upside. I like the idea of buying into the start of the next move, rather than playing catch up with the last move.
Greg Schnell, CMT, MFTA
Senior Technical Analyst, StockCharts.com
Author, Stock Charts For Dummies
Want to stay on top of the market's latest intermarket signals?