West Texas Intermediate Crude Oil Futures (Continuous futures contract)BlackBull Markets
Description
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This is why I think Oil will head lower.
October 5th and 6th were very big down days that created an imbalance around the 87.1 area. We saw a break down of the channel and now even after news it only retested the 87.1 area and wasn't able to get above that. Currently, it's trading just below the broken channel and is struggling to get more traction.
Bear case: The Bulls aren't able to push the price higher above the 87.1 and we head lower. If that's the case we may see Oil head lower to the low 70's or high 60's area. That'd be roughly the measured objective of the broken channel.
Bull case: The Bulls push past the 87.1 area and have a decisive move above it. This would result in a false break down of the channel and would open the possibility of a much stronger move towards the $95 area and potentially higher. A false break to one side of a pattern like this often cause an aggressive move in the opposite direction.
All that being said, this of course, will affect Energy stocks so be sure to manage your risk and DYDD