By some odd twist, oil gushers have come down in American cultural memory as a form of good news evidence of riches found, like the popping of some geological champagne cork. ( ) The truth, however, is that gushers, which plagued the early decades of the oil business, were disasters anywhere and everywhere they happened. They occurred when oil drillers penetrated a formation where oil and natural gas were under high pressure. The geyser of erupting oil could destroy drilling equipment, kill workers and shatter the eardrums of those it did not kill. Fire was a huge risk. Getting gushers under control sometimes took months. (Justin Gillis; The New York Times; 21.06.2010)
The oil-price gusher started to erupt in early November 2010 as the price broke the (blue) triangle-leg at 82. A short breakout to 88 followed, whereafter a classical pullback to the (protracted) triangle occurred. As per definition, the thrust starts directly thereafter as the price commenced to rise the last 2 days, a thrust to the upside is anticipated (instead of a thrust to the downside). The goal of this thrust is to rise above the resistance that was marked by the previous breakout (88) & to transform it into a new & sustainable support so that a new & sustainable upward-trend can start.
The longer-term picture since 1995 shows the price moving up predominately within the (green) trend-channel, whereas the price action can be understood with the 2 (red & blue) triangles. In 2004, the upper (blue) triangle-leg at approx. 38 was broken, whereafter a breakout to approx. 150 took place until 2008 which was followed by a pullback to the (blue) triangle-apex at approx. 35. Hence, the thrust to the upside began in early 2009. According to the upward-sloping (red) triangle, the breakout started in 2005, whereas the pullback in 2008 was not able to hold above the (red) triangle-legs starting a breakout to the downside. As the price did not continue to decrease sustainably, no thrust to the downside occurred as a relatively fast rebound above the (red) triangle was accomplished in 2009. In early 2010, a final pullback to the (red) triangle-apex at approx. 66 took place, whereafter the price started to rise indicating a thrust to the upside since then & especially since breaking above the (violet) resistance at approx. 78. As per the (red) triangle, a longer-term sell-signal is generated only when breaching the price-level of the (red) triangle-apex at approx. 66.
When comparing it with the DOW index (in form of the shown ratio), it strikes that - with its high in 2008 - the XOI has outperformed the DOW more than 3-fold since 2000. However, the ratio decreased heavily since its high in 2008 signifying that the DOW performed much better than the XOI during that time. More importantly for the present & future is that the (violet) resistance was broken successfully recently generating a buy-signal (for the XOI against the DOW). Since reaching the (red) resistance at approx. 0.10 most recently, a sell-signal was issued as a pullback became more probable potentially taking the ratio back to the (violet) support. A longer-term buy-signal (à la thrust to the upside) is not generated until rising above this (red) resistance.