Keep An Eye On This Key Technical Level For Oil Heading Into The Election

The incredible volatility in the crude oil market has continued throughout the summer. After dipping as low as $26/bbl back in February, WTI crude oil prices nearly doubled in a matter of about four months. Once the run peaked above $51/bbl in June, oil prices once again performed a complete 180-degree pivot and slid straight back down to below $40/bbl by early August.

WTI quickly bounced off the $40 support level and logged seven consecutive days of gains this month to once again climb back above $49. But with WTI now hovering between $46 and $49, which technical levels should traders be watching?

According to Turning Point Analytics, $40/bbl is the key to WTI maintaining its bullish technical picture.

TPA has said that Crudes low on 2/11/16 was probably the most important macro event in the past 12 months as it coincided with stocks rallying, a broadening of the market rally, a high yield rally, and a reduction in bond risk spreads, Turning Point wrote in a new report. However, if WTI doesnt hold that critical $40 level, all of the other markets mentioned above could be hit hard as well.

In addition to the $40 support level, Turning Point highlighted $52 resistance and $62 resistance as other technical levels to watch.

So far in 2016, the United States Oil Fund LP (ETF) (NYSE:USO) is down 1.4 percent.