US Oil Head and Shoulders/Bottoming Pattern
This is a 2 hour chart of US Oil. I zoomed out a bit because I want you to see this support/flip zone we are at. Provides more confluence. Of course, you can easily see this on the daily and other longer term charts.
We bounced from this zone and it seems we have exhausted the downtrend made up of lower highs and lower lows.
Currently, we may have made our first higher low which requires a higher high to confirm. We appear to be in this process.
I am waiting for the break and close above 53.30 which is also a flip zone and is a neckline for the head and shoulders we have. 55.00 would be our first target zone.
Let's take a look at UK Oil too:
I would say the similar criteria is being met, but the flip zone we want to see break is the 59.30 zone.
Oil is interesting and I spoke about the geopolitics in a previous post. Oil is key for Russia and China in attacking US Dollar Demand and Iran is key for them. Linked below.
However, I believe we are going into a recession (or maybe already in one) and oil will be suffering. I outlined this in my Aramco oil post.
Everyone knows about repo. How the Fed is now once again expanding their balance sheet. Stimulus is coming. We are not in free markets anymore and banks require capital and need to be propped up. In the last oil downturn, governments forced banks to loan to suffering oil companies. These oil companies could not fall due to employment. This means that a lot of banks have loaned money to oil companies that they know will never pay back. Zombie companies.
Oil for this reason needs to be propped up. This is the world and environment we are in as we head into the confidence crisis and closer to big government. Everything needs to be managed because banks will fail, pensions and retirements will fail (make money when stocks go up only).
We bounced from this zone and it seems we have exhausted the downtrend made up of lower highs and lower lows.
Currently, we may have made our first higher low which requires a higher high to confirm. We appear to be in this process.
I am waiting for the break and close above 53.30 which is also a flip zone and is a neckline for the head and shoulders we have. 55.00 would be our first target zone.
Let's take a look at UK Oil too:
I would say the similar criteria is being met, but the flip zone we want to see break is the 59.30 zone.
Oil is interesting and I spoke about the geopolitics in a previous post. Oil is key for Russia and China in attacking US Dollar Demand and Iran is key for them. Linked below.
However, I believe we are going into a recession (or maybe already in one) and oil will be suffering. I outlined this in my Aramco oil post.
Everyone knows about repo. How the Fed is now once again expanding their balance sheet. Stimulus is coming. We are not in free markets anymore and banks require capital and need to be propped up. In the last oil downturn, governments forced banks to loan to suffering oil companies. These oil companies could not fall due to employment. This means that a lot of banks have loaned money to oil companies that they know will never pay back. Zombie companies.
Oil for this reason needs to be propped up. This is the world and environment we are in as we head into the confidence crisis and closer to big government. Everything needs to be managed because banks will fail, pensions and retirements will fail (make money when stocks go up only).
