Last week Friday oil turned down from our daily cycle's first trendline(red). In normal circumstances that level shouldn't have been such a strong resistance but the falling stocks scared the oil longs also and we had a little panic. As stocks were moving down into the daily cycle low bears could use the possibility to turn down price from the red trendline. That was the only reason oil was dropping so heavily last week Friday. Normally we would have had 2 -3 nothing day around the trendline.
The next move will be a break above the red trendline. As we break it I will remove that from the chart and the only trendline I'll be watching is the blue daily cycle trendline which we will be testing or breaking down at the daily cycle low. Though we are getting a bit late in this daily cycle I still think we have 7-10 more days to rally and I would like to see oil to break above the previous high (51.6$)
If stocks are starting to rally out of the DCL today that will give a big push to oil shares and oil also. The big winner will be XLE and ERX in this rally.
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We are tagging the daily cycle's trendline. We should bounce from here after today's data. If there is no bounce and we beak down the blue trendline we will be heading to the DCL for 4-5 days. It should be a weak DCL to 42-43$.
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We broke the trendline though the data was good. Let's wait the close
Comments
Machinerain
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you are superman
Machinerain
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yes
AliQaiser
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YOU ARE MY BEST MENTOR !!!! IM FALLOWING U SICNCE I STARTED HERE !!! 4-8-2016 ;)
VirtualFax
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Parabolica
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After this correction, USOIL will boom, skyrocket through the ceiling...! For sure!
ma.sanjuy
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I dont think so. Oil is not in short supply and demand of oil is increasingly being met by alternate sources i.e. solar based power stations, solar based electric motor cars etc etc. The oil cartels seem to be now realising this and i dont think they will want to now keep raising their prices. If they do so, they are indirectly killing their own markets...
Parabolica
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Oil's purpose is not confined to motorcars. Even if your statement were true, ages would have to pass until developing countries and undeveloped countries would be able to benefit from solar and electric alternatives. Without oil you wouldn't have a keyboard to type your comment...
andrej123456
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It won't skyrocket. You probably noticed that major banks have big bets on short oil futures.
Parabolica
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Their shorts are not cast in stone not are mine... But I concede the commitment of traders is important. Nonetheless, after this correction, which might take another while, we will go up. The leg on the daily chart has to end and it will end
andrej123456
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I agree. But it is going to take months to years to reach let's say 70 USD/barrel. + We would keep in mind what hapenned before 2000 and 2008 USA elections. I think that' there is a possibility that stock market can collapse if Trump is going to win or after wins. And then we can see not 29 USD/barrel but 19 USD/barrel for a while.