Remarkably, crude oil prices are continuing to trade in their triangle formation. As the chart shows, they tried to break out higher in recent weeks. But there was no follow-through.
The high-frequency traders were clearly hoping the US Federal Reserve would announce a new round of quantitative easing (QE3), and provide the firepower for a further increase. However, the Fed disappointed them. And so prices have come back down again.
Equally, the fundamentals of supply and demand continue to make today's high prices look quite absurd. Not only is there no shortage of oil, as Saudi Oil minister Naimi reminded the world last week. But demand forecasts continue to be reduced, whilst supply is increasing.
Thus the US Energy Information Agency (EIA) has reduced its estimate for 2012 demand to 88.81mbd, whilst increasing its supply estimate to 88.97mbd. It notes that higher prices caused US gasoline demand to fall 2.8% in Q1, despite it being the warmest winter for 50 years. It also projects US production at 6mbd, the highest since 1998, and rising.
Of course, the bulls still hope for disruption in Iran. But US Defence Dept briefings suggest the US has very little desire to support any military action at the moment, terming it "a catastrophically bad idea".
Equally, Saudi Arabia is understandably still upset by the alleged assassination attempt on its US ambassador. So its promises to make up for any Iranian shortfall seem very believable.