Analys från DailyFX
Crude Oil Price Forecast: Stability Appears Bullish
Access Free Oil Trading Guide from DailyFX Analysts HERE!
Talking Points:
- Crude Oil Technical Strategy: Price stability above support (50/52) favors upside
- COT-Crude Oil Record Spec AND Hedger Positions
- Resistance set at $54.29/bbl, evening start top
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.
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.
D1 Crude Oil Price Chart: Crude Oil Volatility Is Subdued, Price Above Support Favors Upside Bias
Chart Created by Tyler Yell, CMT Courtesy of TradingView
Key Levels Over the Next 48-hrs of Trading as of Tuesday, January 31, 2017
T.Y.
To receive Tyler’s analysis directly via email, please SIGN UP HERE
What’s inside:
- EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
- Resistance in vicinity of 11825/80 likely to keep a lid on further strength
- Targeting the low to mid-11600s with more selling
Confidence is essential to successful trading, see this new guide – ’Building Confidence in Trading’.
Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.
Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.
Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).
Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.
For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.
EURUSD: Daily
—Written by Paul Robinson, Market Analyst
You can receive Paul’s analysis directly via email bysigning up here.
You can follow Paul on Twitter at@PaulRobinonFX.
Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.
EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.
— Written by Christopher Vecchio, CFA, Senior Currency Strategist
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
Follow him on Twitter at @CVecchioFX
To be added to Christopher’s e-mail distribution list, please fill out this form
Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.
GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.
— Written by Christopher Vecchio, CFA, Senior Currency Strategist
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
Follow him on Twitter at @CVecchioFX
To be added to Christopher’s e-mail distribution list, please fill out this form
- Brent crude up USD 9/bl on the week… ”deal around the corner” narrative fades
- Market Still Betting on Timely Resolution, But Each Day Raises Shortage Risk
- TACO (or Whatever It Was) Sends Oil Lower — Iran Keeps Choking Hormuz
- Oil stress is rising as the supply chains and buffers are drained
- Buy Brent Dec-2026 calls with strike $150/b!
-
Analys från DailyFX10 år ago
EUR/USD Flirts with Monthly Close Under 30 Year Trendline
-
Marknadsnyheter6 år ago
BrainCool AB (publ): erhåller bidrag (grant) om 0,9 MSEK från Vinnova för bolagets projekt inom behandling av covid-19 patienter med hög feber
-
Marknadsnyheter3 år agoUpptäck de bästa verktygen för att analysera Bitcoin!
-
Analys från DailyFX13 år ago
Japanese Yen Breakout or Fakeout? ZAR/JPY May Provide the Answer
-
Marknadsnyheter3 år agoDärför föredrar svenska spelare att spela via mobiltelefonen
-
Analys från DailyFX13 år ago
Price & Time: Key Levels to Watch in the Aftermath of NFP
-
Analys från DailyFX9 år ago
Gold Prices Falter at Resistance: Is the Bullish Run Finished?
-
Nyheter7 år agoTeknisk analys med Martin Hallström och Nils Brobacke