USO Extends Two Month Oil Rally

The USO ETF has been on a pretty good two month rally here of late. Oil prices in general have jumped from $69 a barrel in early February on investor expectations that a gradual recovery in the U.S. economy this year will eventually boost crude consumption. The thing that could stop this rally is ACTUAL consumption. The Energy Information Administration said crude inventories rose by 2.9 million barrels last week, slightly more than analysts expected. Notice also the clean down trendline that we have to break through first.