The price of crude oil as well as brent hit new, three year highs on Thursday and many are starting to take a closer look at the recent trend. Has oil moved too far too fast and due to pullback? This is a very common question that can really be applied to many stocks as well so let's take a look at oil and see what opportunity there may be.

First of all we will want to know if shorting oils uptrend is a long term play or short term. Have you ever heard of scalping? This is simply where traders enter for a quick move that they expect to see in the short term. If it takes a few days for the product to make a move then that would be perfect for the scalper. In the case of oil we would be looking for a scalp.

Now we need a product. Many traders are not comfortable or don't know enough about futures so they will likely use an ETF. United States Oil Fund (USO  ) is one of those ETF's that is focused on oil. With the short term extension in the USO scalpers can look for a short position in the short term. Stocks like to return to their 20 day moving average and a quick glance at the chart shows that oil is quite extended from this indicator.

Finally, we need a target. Since this is just a scalp we are hoping for a quick move down but we have no reason to expect a sharp move, or a collapse. In the extremely short term the scalper (in this case) will simply look for the USO to return to the 20 period moving average, though keep in mind that each day that goes by the average will rise as well. In this case it seems the $12.30 are is the likely target.