I see 2 scenarios to evolve here.
1. Scenario A. (green)
Oil will be in a range between the last intermediate high (51.60$) and the previous daily cycle high (49.13$) waiting for the 20 to catch up the price. In this scenario oil would follow the stock markets : in this case SM is waiting for the result of the US elections in a choppy range.
2. Scenario B (red)
Oil is due to its half cycle low. We are around halfway of this daily cycle low. We had a strong rally at the beginning of this daily cycle : broke through at first try the last daily cycle top but the rally stopped at the last intermediate cycle high. As all the indicators are showing downwards I suspect that oil will have a little bit more serious drawdown to the HCL as most of the traders would think.
is crossing over. left overbought territory. SlowStochastic also turning down.
If we see this scenario price can easily come and tag the 50 and maybe even the green .
I'm not going to do anything in oil right now. The energy stocks doesn't seem to be too strong.
The chance for a decline is quite high to go long right now but we are still early in the intermediate cycle to short oil .
It's still not decided if it's a HCL decline starting or we are going to start a rally for 2 more weeks....
Now it's looking like a false breakout...
That's why I didn't want to jump the gun at the breakout.
The HCL is still ahead of us.