For those of us who are wondering why the days of declining prices at the gas station have ended, a look at the 1 year chart of crude oil will give us an idea.

From a high of $147/bbl, oil has dropped to a low of $35/bbl a few months back and that seems to be the point where the oil traders are supporting the price.

Based on what we see, it seems that oil has bottomed out and is now in the midst of a rounding bottom.  The moving averages have turned bullish and is now below the current price, supporting the price movement.

If we saw how the MACD as reacting to the price drop starting late October, we could see that there was also  a bullish divergence happening already.  This alone was enough warning that oil wasn’t going to go much lower than the $30 level.  True enough, we are now nowhere the $30-$40 area.  Oil went up by around 9% last night to close at $52.64.

Based oil’s performance, we see a resistance at around $70.  This will probably be reached within 2 months.

I guess it will soon be time for people to start riding the MRT again.  I hope that should ease up the traffic on the streets.