Oil's Triangle Pattern Likely To Resolve Down!
Oil has taken a huge plunge in the past few months and a recent OPEC meeting failed to prop up prices despite a slightly greater-than-expected production cut. Despite many traders trying to be long (including myself), gains have been very short lived as oil seems reluctant to rally or sell off.
While oil and equities don't usually have much to do with each other, sometimes they do. At the moment oil seems to be playing the role of the deflationary canary in the coal mine. At a certain point, the decline of oil prices will bring down the oil producer complex in equities and eventually weigh on the market as a whole.
Given that, the current triangle in oil (shown above in daily and hourly timelines) is likely a continuation pattern that, upon breakdown, won't have support until the $45 - $45.50 area.
Short oil on a break of trend - currently @ the 50.50 level
Target $45-45.50
Stop: $51.50
StockTwits: $CL_F, $USO
While oil and equities don't usually have much to do with each other, sometimes they do. At the moment oil seems to be playing the role of the deflationary canary in the coal mine. At a certain point, the decline of oil prices will bring down the oil producer complex in equities and eventually weigh on the market as a whole.
Given that, the current triangle in oil (shown above in daily and hourly timelines) is likely a continuation pattern that, upon breakdown, won't have support until the $45 - $45.50 area.
Short oil on a break of trend - currently @ the 50.50 level
Target $45-45.50
Stop: $51.50
StockTwits: $CL_F, $USO
Trade active:
Trade is now on
Comment:
Working well so far
Comment:
Covered a large amount of my position here, but leaving some on until the target area.
Trade closed: target reached:
Personally out of this trade, but it probably does go lower. Closing this trade as we have made a lot and are very close to the target.