Crude Oil Posts Weekly Gains

Oil prices managed to make an impressive recovery with price action recovering nearly half of the declines set off in the previous two weeks.

As a result, oil prices are now trading near the 41.00 level.

There is, however, a strong hidden divergence on the 4-hour chart which might suggest a possible correction.

To the downside, this would mean that oil prices could correct back to the 38.83 level to form support.

Such a move would validate the upside bias. Alternately, if the bullish momentum continues, then we expect oil prices to continue further to test the 42.00 level.