Oil still in a channel?

Not much time to comment. A picture is worth a thousand words. Middle line is the regressed linear fit for the Oil down turn. Outer lines are at 1.82 sigma about the mean. A much smaller sigma channel defined the USO action for the past 6 weeks until yesterday. But just pushing the channel edges to 1.82 sigma captures todays peak, and shows it is in line with the mid july peaks using the same channel top line. So we may just be looking at an extreme channel excursion, and not necessarily a resumed oil rally.

If we bust further up, I will have that much more confidence the oils bulls are back. But if we stay within this 1.82 sigma line and start dropping, we're still obeying the channel, which means some more tradable pivots along the sigma values which have shown support/resistance in the past my come into play.

Tht all being said, oil will not be going to zero. Real bottom support and decent upward growth from there are due, if not overdue. But right now, technically, its battle of conflict support and resistance, and war in Georgia isn't helping those who would have it drop more.