Technicals: Most of us in Europe and America were sitting/preparing for the Christmas dinner when oil dropped 4$ on the 24th of December. Most probably it was a natural drop... I let you guess who run the stops on a day when the next day was Holiday, and also the 26th of December was a Holiday in many European country... After the the nasty Christams Eve attack price miraculously started to rally. It was taking out resistance after resistance... First we broke the trendline, next day it closed above the 10 MA. Then we started to test the bottom of the previous range at 50$.
Today despite the bearish oil inventory numbers relesaed by the US Govt we broke back into the range. To tell the truth it's strange that the Saudi Energy Minister started to talk about actions - taking by the OPEC and malliance included Russia - to bring back market from the big 4Q drop in 2018 immediately after the big products build in the USA... I'm afraid they got rid of some contracts after the bounce today.
I see 2 possible scenarios in the following weeks.
1. We test the top of the range at 54 and drop back to 50$ building a H&S pattern.
2. We drop back to around 48$ (10 MA) without testing 54$. If the Saudis are playing the above game than this is starting this night.
Notice how do we turn down from 50 MA and RSI is leaving overbought .
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That’s what I was afraid of... the resistance at 54 is too strong.iwe need a pull back.
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Strong. I would like to see a 200 MA tag on the hourly. Not sure we will get it though.
Trade closed manually
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Price: 59.43
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We are going to get a good buying opportunity in oil soon.
It's on plan. Nice touch of 54 over the long US weekend. Looking for the low end of the channel or lower now (48 for fib or 44/42 to retest) to get back in. Not going to play the downside.
FFMEO
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Looks like Oil builds the second shoulder in H&S model.
@FFMEO, not ‘has completed’. The prediction of today’s drop was excellent. That was everybody's wating for from your posts.
bertcoin
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I'm thinking to reload at the usual .382 (about 49.06) to the .618 (about 47.8). If we go full cycle from the ICL, that could be another 2-3 weeks. I'm chanting "patience" to myself.
chartwatchers
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@bertcoin, I think you might be right. It’s not going to be a huge drop :may be only two days perhaps three
dp
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@bertcoin, what kind of cycles you are talking about, intermediate?
Can you please show any layout of the surrounding cycles?