A number of technically bullish things have happened over the past 30 days that has turned me into a fully fledged oil bull.

First of all, oil has been making higher highs and higher lows since bottoming in late December.

Second, oil has rallied above its 50 day moving average and since then that average has acted as support.

Third, just a few weeks ago the 20 day moving average crossed above the 50 day moving average. This is known as a bullish cross.

Lastly, the fact that both the RSI and Slow Stochastic have turned up after hitting 50 suggests the underlying trend is strengthening.

Listen if you’re buying for the long-term, this is a sweet spot to buy it at. If you’re a short-term technical trader, this is still a sweet spot to enter into.

If oil keeps rallying then I don’t expect any headwinds untill the $70 mark. By that time, the 200 day moving average should also be around there (marking a huge resistance point)

An ascending triangle is made up of a resistance line (top of the triangle) and then an upwardly sloped trend line (bottom of the triangle) that meets the resistance.

When you see this pattern, you’ll notice that the stock will bounce off of its trend line and hit resistance. Then it will fall at the resistance line and again find support at the trend line.

Eventually, the moves get smaller and smaller as the support and resistance lines meet.

Sooner or later, the stock will break out one way or the other. If it breaks above the resistance, then the bull run is confirmed. If it breaks under support, it usually means the bull run just fizzled out.

Most traders will look at the above setup and trade it like this. They place a buy order for Yahoo, Inc. (NASDAQ:YHOO) about 2-3% above the resistance line.

That way if the YHOO breaks through resistance, shares are automatically bought.

A good trader may also place a short-sell order 2–3% below the YHOO’s support line. If the stock breaks under support, it should move down further.

Why 2-3% away from those resistance lines?

Because it allows for some fluctuation. Technical analysis isn’t an exact science. So you always should allow for a buffer when trading based off of it.

Jerry Yang After Saying "No" to Microsoft's Offer

This is a guy who sucked so many eggs, that he decided to say “no” to Microsoft’s buyout offer, even though they were offering a MASSIVE premium to Yahoo’s stock price.

Just so you know, that offer was to buy Yahoo for over $40 a share. At the time of the offer, it was trading under $30 a share. Today, Yahoo trades at $12.

It’s not that shocking that Jerry Yang was compelled to give up his position at Yahoo. After all, he lost shareholders one of the most lucrative paydays ever (right as the economy was plummeting).

But believe me when I say that Jerry Yang leaving is good news. Just take a look at the chart below to see why I think that…

What’s interesting about this chart is that Yahoo prices bottomed right as Jerry Yang was leaving Yahoo (he resigned on November 18th).

After that announcement, shareholders took Yahoo stock up over 40%. And since then, Yahoo has continued to make higher lows in an attempt to rally past $14 a share.

Adding strength is the fact that the Slow Stochastic (at the bottom of the chart) is oversold right now.
Oversold means just what you think it does – something has been sold too much. And if something has been sold too much, then eventually buyers will swoop in and snatch up shares at the more attractive, lower prices.

If you notice, the previous two times Yahoo was oversold, it went on to rally at least 15%.

While it is oversold, we also see Yahoo hitting the bottom of its newly formed support channel. And lastly, we see Yahoo starting to use its 50-day moving average as a support, not resistance.

This means Yahoo shares are primed for a climb over the next two weeks. Buying shares is a great move, but buying call options is a better one.

A trend channel is nothing more than two trend lines – a resistance and support line – that form a “channel” that any given stocks price trades between.

Google’s trend channel began in late November. Every time Google hit the bottom of its trend channel, shares moved higher. And every time it hit the top of, prices would stall out and move lower.

As you can see, Google is now hitting the top of its trend line. Plus, both the Slow Stochastic indicator (under the chart) and the RSI indicator (above the chart) are showing shares as overbought (meaning sellers should flood the market).

One of the best ways to capitalize on this move is by simply buying a Put option which makes money as share prices drop. The move shouldn’t take more than ten days to complete.