We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • #recession 💯 https://t.co/jpGSQ7eOxl
  • Heads Up:🇯🇵 JPY Consumer Confidence Index (MAR) due at 05:00 GMT (15min), Actual: N/A Expected: 35.0 Previous: 38.4 https://www.dailyfx.com/economic-calendar#2020-04-09
  • Wall Street Futures update [delayed]: Dow Jones (+0.09%) S&P 500 (-0.01%) Nasdaq (-0.30%) -BBG
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.64%, while traders in US 500 are at opposite extremes with 75.87%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/PRc0F82cEe
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.17% 🇪🇺EUR: 0.10% 🇬🇧GBP: 0.09% 🇦🇺AUD: 0.07% 🇯🇵JPY: -0.09% 🇨🇦CAD: -0.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/bQLBwqrzPU
  • The Federal Reserve has made a powerful statement about its commitment to shoring up offshore $USD funding markets through the #coronavirus spread. Get your market update from @DavidCottleFX here:https://t.co/fLZjxjr4L9 https://t.co/Ao7XeiY7wS
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.84% France 40: 0.80% Wall Street: -0.23% US 500: -0.26% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/aHuwHMbNl1
  • RT @DanielGMoss: $SPX Rising wedge formation signals looming reversal as price attempts to breach 2009 uptrend support-turned-resistance…
  • The US Dollar appears to be back on the offensive against ASEAN FX such as the Singapore Dollar and Malaysian Ringgit. The Philippine Peso gained. What does USD face from here? Find out from @ddubrovskyFX here: https://t.co/U8VGdJPIST https://t.co/F8pRQwz1rR
  • (ASEAN Technical Outlook) The US #Dollar fell against #ASEAN FX such as $USDSGD, $USDPHP, $USDMYR and $USDIDR. Chart patterns are brewing like a Bullish Pennant, Descending Triangle and Falling Wedge #USD - https://www.dailyfx.com/forex/technical/article/special_report/2020/04/09/US-Dollar-Technical-Outlook-USDSGD-USDPHP-USDMYR-USDIDR.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/J7j7Kpvyx4
Crude Oil Price Forecast: Stability Appears Bullish

Crude Oil Price Forecast: Stability Appears Bullish

2017-01-31 18:56:00
Tyler Yell, CMT, Currency Strategist
Share:

Access Free Oil Trading Guide from DailyFX Analysts HERE!

Talking Points:

The price of Crude Oil appears at odd with the sentiment, which we recently reported via the CFTC Commitment of Traders report showed that speculators are loading into long positions at a record clip. However, the record spread between commercial hedgers and speculative investors has hit extreme levels, but the price has failed to breakout.

The first chart is taken from the article, COT-Crude Oil Record Spec AND Hedger Positions by Jamie Saettele, CMT. The price of Crude Oil current month futures contract, CL1, with net positioning per the COT shown below the price.

The worrisome observation from the chart is that the last time we saw such extremes in positioning was the summer of 2014 when Crude Oil would last trade above $110/bbl before diving to a low of $26/bbl in February 2016. Sentiment and positioning analysis is helpful, but not predictive, but it is worth noting that a breakdown that takes the price below the key level we will soon discuss could be indicative of a larger, albeit smaller breakdown in Crude Oil price like developed in H2 2014-Q1 2016.

Crude Oil Price Forecast: Stability Appears Bullish

Image Source: COT-Crude Oil Record Spec AND Hedger Positions by Jamie Saettele, CMT, Sr. Technical Strategist

There has been an impressive amount of compliance by OPEC, but the stability in price in the lower half of $50/bbl appears to show this was fully priced in. It’s difficult to say what could kick off the next Bull trend or the next Bear breakdown, but many are watching the USD for clues ahead of the FOMC for the possible next big move in Crude. However, it’s worth noting the Crude Oil and the US Dollar has recently moved to a positive correlation relationship.

The positive correlation has been blamed on the strong bullish positions that hedge funds have in both USD & USOIL (see chart above.)

When looking at the chart below, you can see a highlighted zone that focuses on a level that was resistance that now appears to be supported. The price also looks to be trading higher within a Bullish Pitchfork drawn off the early August closing low and the October and November price extremes. The Daily Ichimoku cloud is also added to the chart and aligns with the lower quarter of the Pitchfork. The two zones of support should prevent traders from getting Bearish if price holds above these levels in anticipation of a downtrend beginning.

From a momentum perspective, you can see that there was a strong move down in Oil at the start of the year that took RSI(5) down to the oversold region. However, the price did not break below the Polarity Zone on the chart, which could be indicative that the next big move is higher rather than lower despite the positioning spread explained above.

Naturally, a break below the Ichimoku Cloud and Andrew’s Pitchfork lower bound would align with a breakdown below the polarity zone that has my focus. Until we can check off all three events as completed, I will await the sideways action in Crude Oil in anticipation of an eventual breakout that will be validated on a break above $54.29.

Join Analysts Throughout The Week For Free Webinars Covering The Key Market Moving Stories & Trades (Free Registration)

D1 Crude Oil Price Chart: Crude Oil Volatility Is Subdued, Price Above Support Favors Upside Bias

Crude Oil Price Forecast: Stability Appears Bullish

Chart Created by Tyler Yell, CMT Courtesy of TradingView

Key Levels Over the Next 48-hrs of Trading as of Tuesday, January 31, 2017

Crude Oil Price Forecast: Stability Appears Bullish

T.Y.

To receive Tyler’s analysis directly via email, please SIGN UP HERE

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.