United States Oil Fund Breaks Out


The price of crude oil continues to rise and is pulling energy shares along with it. Chart 1 shows the United States Oil Fund (USO) surging to the highest level in eight months after clearing its previous high formed during August. The USO has also climbed above its 200-day moving average for the first time since the start of the year. That's helping make energy Thursday's strongest sector.

Chart 1

Energy stocks have gone from the market's weakest sector this year to the strongest over the past couple of months. And they're Thursday's strongest sector again. Three of the energy ETFs shown in previous messages are trading at six month highs. Chart 2 shows the Energy Sector SPDR (XLE) trading at the highest level since June. Its relative strength ratio in the upper box is rising as well. The same is true of the two other energy ETFs shown in Charts 3 and 4. All three appear headed toward their previous highs formed in June. The VanEck Vectors Oil Services ETF (OIH) in Chart 4 has been the strongest of the three; and the closest to its June high. In addition, its 50-day average has crossed over its 200-day line which is another bullish indication (blue circle).

Chart 2

Chart 3

Chart 4

Editor's Note: This is an article that was originally published in John Murphy's Market Message on Thursday, December 10th at 11:38am ET.

John Murphy
About the author: is the Chief Technical Analyst at, a renowned author in the investment field and a former technical analyst for CNBC, and is considered the father of inter-market technical analysis. With over 40 years of market experience, he is the author of numerous popular works including “Technical Analysis of the Financial Markets” and “Trading with Intermarket Analysis”. Before joining StockCharts, John was the technical analyst for CNBC-TV for seven years on the popular show Tech Talk, and has authored three best-selling books on the subject: Technical Analysis of the Financial Markets, Trading with Intermarket Analysis and The Visual Investor. Learn More
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