My hourly work is "warning" me that crude oil's powerful rally off of yesterday's low at 69.83 into the morning high at 73.3 exhibits a bullish profile, which indicates to me that new uptrend might have started rather than the strength representing an oversold bounce after Tuesday's powerful dwonside reversal spike. If the bullish scenario is unfolding, then at no time should oil prices violate 69.83. Conversely, pullbacks into the 71.50/00 area likely will be met with another round of buying interest. It is with the foregoing in mind that I rekindle interest in exploring long positions in the Oil Service HLDRs (OIH) and the ProShares Ultra Long Oil & Gas ETF (DIG).

The enclosed hourly candlestick chart of the DIG shows the August rally period, which exhibits bullish form from the August 17 pivot low at 26.43 to the August 25 high at 31.60. After that rally, let's notice that the pullback to 29.04 yesterday represents an almost exact 50% correction of the prior advance before yesterday afternoon's initiation of a new upleg. It is interesting to me that the August 17 low at 26.43 also represented an almost exact 50% correction of the July 8 to August 3 advance ­ which tells us that the bullish profile remains consistent within the development of a larger, year-long base pattern. Based on my pattern and momentum work, as long as yesterday's low at 29.04 remains a viable corrective low, I will regard the action of the past 24 hours as the start of a new upleg that should climb to retest the August high (31.60) on the way to 33.50 thereafter.