Well, like most oil commentators, everyone has been expecting the break, either up or down, that just hasn't materialised.
From my last post of Apr 22 (Chart of Apr 20), all we can see is sideways drift, so
I have switched into candles to get (some) better perspective.
In my last post, I commented I expected to ease, which It has.
I notice recent bars all have either upper or lower pins. This is indecision. There was a similar price area congestion pattern back in Jun/Sep 2009, but I do not believe this is related.
Immediate overhead resistance is $68.80-69.00. Previously mentioned Resistance sits at $69.70 then $71.30 then $73.75 and probably $70, $71, $72 and $73 to fully box the Quadrella (Australian horse betting terminology meaning to couple all your selected possible winning outcomes).
The M/W HS reversal pattern (from Feb and Dec 2016) projects a high of $80 (56-26)+50. A fib time projection would be Dec(breakout) x 1.618 := 1.94 or approx late Oct/Nov 2018.
Immediate support resides at $67.70 then $66.60 then 65.60
(The recently reported build in inventories can probably be attributed to scheduled maintenance as the switch is made from Winter to Summer refined fuels. Coupled with this we have $US appreciation as interest rates rise (commodity ), GDP improves ( ), some international tensions coming off the boil ( ), and Iran and Venezuela go on ( ). This is contributing to the indecision noted above.
Further, reporting season now suggests that many of the oil dependent companies may not have hedged their purchase commitments:= inflationary:= lower profitability:= higher $US and interest rates:= lower oil demand. (sources ; Barchart)
Consequently (tick all of the above), I still favour the downside.
(source Quandl): Open Interest (OI) is rising (expected). Producer longs have increased (+5) to 44k.
produce shorts are flat (+1) 25k and Fund longs are flat for the week.
I will open a short on pin high bar close sub swing low of Apr 24 ($67.70) with a target a buck lower (initially), with an (initial) SL at $68.25+ leading into the politics of May 12. I know lousy RR, but this indecision is going to break soon and that will either improve or stop me. Plan B - double down! ... no just joking ...
Then wait and see.
PS if that red line indicator starts to rise, then the current short term top is in!
... just my 2c worth