First, oil's been an somewhat of a tear (albeit, sputtering in places) off of the April low of 35.22. Shorting here would be against the trend, which has been . That being said, the upside reward here is somewhat indeterminable, and if you try to do any reading on the subject, there is speculation all over the place as to where price moves from here (e.g., "Saudis don't want >$50 oil , since this brings the spectre of shale piling back into the market"; "Shale is primed to ramp back up on >$50"; "Shorters, feeling the pain on misgauging the 'top,' are bailing here, their egos crushed", etc.).
Secondly, it simply doesn't look like a breakdown is imminent, with the short and long EMA's angling upward, and it could very well flop around in a fairly narrow range (as it is want to do for annoyingly long substantial periods of time).
Third, an OPEC meeting is right around the corner. Although not much is likely to happen during the meeting, the fact that "nothing happened" may actually move the markets, since the Saudis are likely to continue to embrace the status quo (which is basically that they will not be the last kids on the block to pump their petro out of the ground and won't agree to anything that makes them the "last kids"). If they don't or if something else comes out of the meeting (which would be an event of miraculous proportion), I certainly don't want to be on the wrong end of things, which is why I'm patiently waiting here.
From purely a charting standpoint, I'm looking for a cross of the 8 and 34 EMA's on the 4H, followed by a break of significant support (which I kind of see at 47-ish) to short on lower time frames (1H or lower) on a retrace to the "slow" or, alternative, an underside test and subsequent rejection of 47 with my eye on taking profit at 43 or, at the very least, peeling some off there and/or moving my stop loss down significantly into profit to allow the trade to run if it appears there's going to be continuation through that level.
As an alternative to trading /CL directly or USOIL , I'm also looking at oil proxies like XOP and OIH for possible assumption option setups (short call verticals or long put verticals) or to trade any /CL breakdown should it occur. If I spot any "juicy" option setups in these instruments, I'll be sure to post those separately ... .