This is my trading plan for the Crude Oil .
As far as I can see we just broke the blue trend line , looks like a good place for a correction.
The plan is very simple, buy at the green support lines when they break, sell when you start a correction.
A bundle of US companies defaulting, I'm sure, I think that process is already in the works. But a small percentage comes from the US. As far as actual supply, who knows? Iran could be adding tot he glut soon enough. I believe that the 56.50 area will be a long term magnet that we will eventually come back up to.
I'm not just talking about US off-shore frackers. There are plenty of international E&P oil companies that have a cash flow breakeven well over $50/bbl. Cost of borrowing is through the roof for these businesses...we're seeing credit ratings slashed left and right.
Great chart! I am in agreement on our pulling back of of the current upper trend line. However, I am curious on your thoughts on us currently being in an overall uptrend? I believe the current (purple) trend will hold to new lows.