If we look at the CBOE index, which has had a tendency to lead oil prices at market tops, we have seen it has already start to turn and is now heading to test the supporting trend line. That trend line currently rests just below 580, and the close today was 585.99.

Crude has seen a massive run up since February, and so the question becomes, is it ready to correct?

Based on historical evidence it appear we must be nearing a short term top. Not saying it can't rally a bit further, but at least based on historical evidence, the bulls are operating on borrowed time.

Thoughts?

All I can say is "Boom!"

The index bused through support and oil fell through its aggressive uptrend support line. There is another trend line currently around the $60 dollar level. Oil prices will likely test this.

Cory Michell, CMT