Despite the US oil inventory data last week and the resulting dip beneath the psychological $50 per barrel level, I saw a broad improvement in oil and gas stocks when I reviewed the charts this weekend. I am not entirely convinced that the decline is over, but there was significant firming in the sector. Some commentators are suggesting that Friday’s gains were largely due to short covering and buying ahead of the February contract expiration. That may be true and it might have something to do with winter weather finally matching the calendar in the Northeast (NYC), but whatever the cause - prices started to stabilize. There appears to be a more neutral trading environment so this week looks to be pivotal in reestablishing a direction. Sideways wouldn’t be bad but if it heads lower, I see no support until $47 and if it heads higher, we now have some substantial resistance at $58 - $60 per barrel.