Although we would have like to have seen the wave 2 pullback take Crude Oil Futures prices up to the $64.50-area, near the 62% retracement and up against the upper boundary of the price channel on the hourly chart, all the pieces are in place for the long-term bear trend re-establish itself in violent fashion over the next few weeks.
As commodity buyers, it is important to keep an eye on the price of the U.S. Dollar. This is because “usually” there is a strong inverse correlation between the U.S. dollar and the price of commodities. Logically, if the U.S. dollar is strong, it makes commodities priced in U.S. dollars more expensive relative to competing products worldwide. Conversely, a weak dollar makes U.S. commodities more attractive and in demand.