USOIL saw a quick jump on Friday, as the dollar falls, only to fall again by the time the market closed. The main theme here is that the market is still digesting Trump's announcement on tariffs and over all trade war concerns, on how that will affect the demand for oil in the coming months. There is also a concern regarding over supply. This is evident by the fact that the US drillers cut 5 oil rigs, the most since march. While bullish news include the lower then expected August oil exports from Saudi Arabia.
Scenario One (Bullish Rebound): Price consolidate at first key support, followed by a rebound
Scenario Two (Bearish Breakout, Bullish Rebound): Price breaks first support, only to rebound to the upside.
Scenario Three (Double Bearish Breakout): Price falls below both key support, potentially entering into a new trend.
Comment:
Scenario One is the most likely scenario, followed by the second one. Keep in mind that price has been in this bullish channel since November 2017; Thus, a bearish breakout would mean a strong change in the sentiment of the market towards oil.
Scenario One (Bullish Rebound): Price consolidate at first key support, followed by a rebound
Scenario Two (Bearish Breakout, Bullish Rebound): Price breaks first support, only to rebound to the upside.
Scenario Three (Double Bearish Breakout): Price falls below both key support, potentially entering into a new trend.
Comment:
Scenario One is the most likely scenario, followed by the second one. Keep in mind that price has been in this bullish channel since November 2017; Thus, a bearish breakout would mean a strong change in the sentiment of the market towards oil.