Crude Oil has had a rough few weeks. Having fallen from $75 to $67 in a relatively short period of time.

Fortunately, price stabilized toward the end of the week and we settled around the $70 level, although on Monday price has opened down near the $68 level.

Last week, Saudi Arabia’s OPEC Governor Adeeb Al-Aama suggested that oil production would in fact fall. That’s despite reports floating around saying that Saudi Arabia is getting ready to flood the market.

In some ways, it is actually tough to know what the truth of the matter is at the moment. The price action over the longer-term is clearly bullish. In reality, this recent fall has just been a pullback. And that is certainly the case if you’re looking at the daily or even monthly charts.

Much attention will again fall on the inventory reports. Especially after last weeks surprise build and the accompanying spike higher in prices. This week we are expecting another draw of around 3.4M barrels.

The Technical Picture

With the oil market fundamentals being a bit grey at the moment, I’m looking more to the technicals.

Like I said on a longer-term basis, we are bullish. And oil has rallied from the lows of under $30 in the last couple of years.

However, the price action we’re seeing at the moment is a pullback. But on a short-term basis, we are actually bearish.

I’m positioned bearishly in my portfolio for the time begin and will remain that way until we get a spike through $75.29 and make a new high.

The trending nature of commodity markets, makes me look to stick with the trend on the daily time frame above all else. And thanks to the pullback, I turned bearish on my short-term assessment.

On Monday I’m looking for a pullback to $69.38, where a gap fill is certainly possible. The API figure on late Tuesday is the major focus early in the week.