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Crude Oil: Approaching the $50 handle

Since the start of the year the commodity gain more than 21.0% however last week was no different with a rise more than 5.0% and is in an accumulation phase since mid-April.

Last week the crude oil rallied with a narrow range and closed near the high of the week, in addition managed to close above the previous week high, suggesting a strong bullish momentum.

Stochastic is showing an extreme overbought market although is still displaying a bullish momentum.

Expecting an upward move to a key level at 50.90 on a break above the previous week high at 46.75 (scenario 1) and a pullback from the key level at 50.90 may drag down the commodity price to the lower range of the weekly resistance at 43.56 (scenario 2).