Oil. Beginning of the drop and the final stage of market growth

May 22

Back in March we made strong profits on oil’s upside move trend continuation on oil played out perfectly.
Now it’s time to profit from the downside.

There are several reasons for a potential decline — and they are starting to align together.

1️⃣ Iran & US — deal getting closer

Negotiations are entering the final stage.

Since April there has been a ceasefire, tensions continue decreasing, and Trump is publicly talking about a possible agreement.

What does this mean for oil?
• Iranian barrels return to the market → +1–1.5M barrels/day of additional supply
• Geopolitical risk premium disappears
• Strait of Hormuz fully reopens

At the same time: OPEC+ is already increasing production
while the global economy keeps slowing down.
Supply rises → Demand weakens

Result seems obvious 📉

“But if there is a deal, won’t stocks and crypto pump?”
Short-term → yes, another squeeze higher is possible

But the market has already been pricing this in for weeks.

When the deal becomes official👉 it may become a profit-taking event rather than the start of a new rally 💣

2️⃣ Macro pressure — US bond yields

In my previous post I explained why rising long-term US yields are one of the most dangerous macro signals for global markets.
10Y and 30Y US Treasury yields continue moving higher.

And if this trend continues, large investors and funds will increasingly ask themselves:
Why hold overheated risk assets when US government bonds offer 5%+ with almost no risk? 🤷‍♂️

Capital starts rotating:
from equities and risk assets → into high-yield “safe” instruments
Liquidity decreases.
And oil is usually one of the first assets to react 💸

On top of that Kevin Warsh officially became the new Fed chairman today. He is known as a hawk and opponent of cheap money.

👉 Fast rate cuts are unlikely under his leadership.

Meaning the environment of expensive money and pressure on risk assets remains intact.

3️⃣ Technical analysis

Brent daily chart speaks for itself:
• price broke below MA20-D and MA50-D
• ascending channel from February is broken
• massive bearish divergence
• indicator turning lower below neutral zone
• heavy sell volume on recent red candles
• key $119–120 resistance failed to break convincingly

The entire structure looks like:
👉 end of the upward correction
👉 beginning of a new leg down

Main target MA20-W zone around $89–90.

✔️ If the Iran deal happens and yields continue rising —
this scenario becomes highly realistic over the coming weeks (or even days) ⏳
_ _ _ _ _ _ _ _

👉 If you want to trade like a professional and not like a gambler — follow for real insights and strategies 🚀

Jun 29

Trade closed: target reached

Excellent execution of the idea. Congratulations to everyone on the profits