1st question: USO vs Crude Oil, seems like no leader and they are twins? Meaning that they share the joys and woes together
2nd question: USO has broke down its 2009 support while Crude oil has not even tested its 2009 support. What is going on here huh?
I smell a rat
Comments
tradecap
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Simple answer: Futures contango
SS96
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Ouch. This is a very basic question!
jangseohee
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3 months Diamond?
A-shot
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Yes, when we see more candles in it,it is a more distinct. otherwise each 3 candles small-large-small can be a diamond.
jangseohee
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i cant imagine if this happens, 6 bucks, no way man
QuantitativeExhaustion
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Govt. forced intervention here. About 5-6 years ago there was regulation change in how commodity based ETFs aggregated holdings. USO like many others, had to purchase longer dated futures rather than the near dated more accurate price reflected crude price.
its a daily chart and i i wont take diamonds on a that of a short time trading period :) Diamonds are nnot the easiest to catch and the bigger the time frame, the better. (otherwise i would see diamonds everywhere :) ). So far it never closed fully below 44.20, but it is not a higher high either.
jangseohee
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Log/linear scale, 2009 support not tested yet
A-shot
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Well, i haven't seen such trading happen to oil before - i.e. taking another dive after a huge slump. I also see that the trading here was straightforward. As soon as it broke the triangle it just went down and was sold off...until a point where the bulls might pick up - many want a sweet spot to enter and look how soon they went in -did not let it dive all the way to the previous support - someone went it already, and enough to cause a green candle so far. I would watch the M candle to see if it is green and see its shape for a lower risk trade. I would start a position now for a high risk trade. (well.it is not that high, it already slumped a lot, and i'm not sure i see reasons for it to dive below 2003 levels.). The EMA 8 will change drastically and kind of late - look it switched direction on 3rd month of the rise. usually i would get it for a trade at least to 0.38 fib level. Im not pro so i dont have free charts here to make it, but connect the lows of 1999 2002 2009 and you will see the the price did a dip below that support, but is above it now.