Buy crude oilThere is a high probability for the crude oil to reach the $100 level in the next month
Opec
(OIL Spot) Bear necessities - 150% Fib expansion not impossibleJust a view on how price has been moved last year.
As a Bear you need to know when to be Bearish and when to go with the Bullish flow
We have learnt so much more about the Oil market in 2021. Like the difference between USOIL price and USOIL Spot prices change as the week goes on. Some days they are the same or 10-15 pips different. Some days can be as far as 70 pips apart with high volatility.
Our very best lesson was on how Vector (manipulation) candles are used to move price but we learnt a lot more than that.
One of the most valuable lessons was about when price get's embedded to the up side or downside. In the 4HR and Daily is where we have seen in stay embedded for 3-4 months at a time. When this happens it results in trending moves the whole time while it is embedded.
When embedded to the upside, significant shorts are less frequent and when to the downside the opposite is true.
With Oil pumping and pumping pretty much all of 2021 with the biggest falls when the embedded was lost, it is only right that we pay attention and be on high alert whenever we see this again.
Despite awaiting a plummet (holding partial sells from 80.35 7th Jan), we have noticed the daily become embedded in Dec 2021 and if it does decide to stay this way for 3-4 months then we will have a very high chance of hitting 150% on the fib extension to the upside which is around $97.2 by the end of 1st quarter 2022. (entered buys at 78.5 - USOIL- with Tight SL before close 7th Jan)
If it is lost however we can have a great sell to the low 60's again and possibly further down before attempting to go and get the Vector candles beyond $83.
If it fails while approaching mid 80's, buckle up for the skydive
(This is a bonus idea for those who trade Spot prices)
Crude Oil Lower Before HigherOPEC+ LEAVES JANUARY OUTPUT PLANS UNCHANGED BUT REMAINS FLEXIBLE TO OMICRON-RELATED SHOCKS
Yesterday the Organization of Petroleum Exporting Countries (OPEC), Russia and its allies, known as ‘OPEC+’, decided to stick to its original plan to increase oil supply by 400,000 barrels per day (bpd) despite the ongoing threat of Omicron on travel restrictions and the coordinated release of special petroleum reserves (SPR) by the US and others.
As a result, oil prices dropped sharply as the news filtered through to the markets with oil trading down 4% at one stage and trading well below $66. The sharp drop has appeared to be overdone as crude oil recovered to end the day in the green.
OPEC’s decision has been welcomed by the US after countless calls for the group to alleviate rising energy costs in light of rising inflation among developed nations. However, OPEC + remains flexible to the unknown effects of the Omicron variant as far as it relates to travel restrictions and ultimately the demand for oil, by keeping the meeting “in session”, allowing any
changes in the lead up to January 2022.
At the time of writing, the USOIL price stands at $68.750, Based on our forecasts a long-term price decrease is expected to be around -18.00%.
- Our option for #USOIL is TO KEEP WATCHING & WAIT FOR THE SELL-OFF MONTHLY CHART CONFIRMATION.
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HIGHLIGH OPEC BS closed Longs start shortsWell since the news of OPEC willing to increase the output price have reversed to a downtrend imho. To see. Past trade closed even and open a short
Crude going ballisticThe oil market seems to be shrugging off the omi-cron fear trade. This is for good reason with OPEC+ cartel causing a spike in fear. The possibility of war whether it be Taiwan or Ukraine. The market LOVES the idea of a war.
Catalyst #1) Satellite images show Russia still building up forces near Ukraine - Reuters
Catalyst #2) US and Japan draw up joint military plan in case of Taiwan emergency – The Guardian
Catalyst #3) The International Energy Agency (IEA) said in its December oil market report that OPEC+ missed its production targets by 650,000 barrels per day (bpd) last month, compared with 730,000 bpd in October. - Reuters
Non-factor: DOE Awards Second Strategic Petroleum Reserve Exchange to Bolster Fuel Supply Chain.
Can OPEC Counter Oil's Decline??Oil has edged up as OPEC has pledged to compensate for demand woes. We are seeing resistance from 69.67, a relative high. Several red triangles on the KRI are popping up on the chart, indicating we are running into some resistance. The Kovach OBV is still bearish, to the point we are severely oversold, so a relief rally could easily take us 200 ticks higher, though 72.99, the next relative high, should provide significant resistance. From below, 62.80, the relative low, should be considered a min lower bound for now.
Brent Crude - Further to Fall?Brent crude has been tumbling in recent weeks, forced lower by slowing growth, a coordinated SPR release and this past week, the new Omicron variant.
OPEC+ had an opportunity to arrest the slump today and at first, it appeared they'd passed up the opportunity. But the decision to maintain not change their planned increases each month came with an important caveat, that they would do so at any point if they think it's warranted.
In other words, they didn't have enough data to hand today but if that arrives at any point between now and the next meeting and warrants an adjustment, they'll do so immediately.
With crude off its lows and higher on the day, has it bottomed out? Possibly. But that will depend on the information that appears over the coming weeks and how bad it is for the global economy.
In the meantime, the price had been falling prior to the announcement but as you can see on the 4-hour chart, it was losing momentum all the time. So the caveat provided the excuse the market was already hoping for.
If it has bottomed for now, how big a correction can we expect? Or can we expect it to rally from here?
While we may see some tests around the 38.2 and 50 fib levels on the way up, the big test above here lies around $76.50 where the 61.8 fib on the 4-hour chart coincides with the bottom of the channel, 55/89-period SMA band and a major prior level of support and resistance. A move above here could put us back into more bullish territory.
OPEC+ would not allow the Crude Market to DisbalanceThe opening trades after Thanksgiving Day brought no optimism for investors as some countries are debating on whether they should release oil from their reserves during a period when the demand is lagging amid new COVID-19 lockdowns in some European countries.
Brent crude prices are losing almost 6% and this may not be the final price. Taking the price chart into consideration I believe there must be an ABC correction after a significant upside movement. The current decline from $86.70 per barrel is commencing in a five wave structure, and we are currently in the first wave - A. But I do believe the A wave has not yet reached its targets and may end within the $74.98-75.75 area in order to meet the condition that Waves 3 and 5 should be 150% or 161.8% of the length of the Wave 1. If Brent prices fall to $76.50, the correction structure will be accomplished, as Wave 5 will be equal to Wave 1. Moreover, prices are supported by a long-term upward trend that started in April 2020 and now is crossing the $74.50-74.70 landmark. Specifically, this key landmark may play a decisive role in the current decline cramping selloffs.
Countries within the OPEC cartel and also countries outside OPEC have been divided as some need high crude prices while others are suffering from it. Saudi Arabia and Russia are ready to freeze any further oil production increases to compensate for interventions from the United States and other major crude importers. However, if El Riyadh and Moscow succeed in convincing other OPEC members and its allies to do this, it is really hard to say what will happen. UAE and Kuwait oppose such halts and may lead the others to follow them.
I think OPEC+ would not allow for any disbalances in the oil market knowing that the United States may easily pour some 70 million barrels into it and may react swiftly during the next meeting at the beginning of December.
Considering the above-mentioned scenario for Brent crude prices, we may expect an upside rebound and for prices to reach designated lows at $74.70-75.70 per barrel. Thus, the new wave B will start to push Brent crude prices towards $81-82 per barrel.
U.S. May Drop Crude Prices for OPEC+The largest oil cartel in the world, the Organisation of the Petroleum Exporting Countries (OPEC) and its allies known as OPEC+ will hold a meeting on Thursday, November 4, to discuss oil production quotas. Markets expect OPEC+ to stay true to the existing deal to up oil production by another 400,000 barrels per day starting from December 1.
On the other hand, some of the largest oil consumers are frowning on high crude prices and are calling on OPEC+ to increase production in order to lower gasoline prices in some regions. China reported in a rare official statement that it had released gasoline and diesel reserves to increase market supply and support price stability in some regions. Now there is a serious threat that an anti-Saudi Arabia and Russia coalition led by the United States could be formed, possibly jointed by the world’s largest oil consumers Japan, India, and China.
U.S. President Joe Biden has already called OPEC+ to increase production beyond the planned 400,000 barrels in order to lower gasoline prices in the United States that have hit $3.7 per gallon, which is a maximum in the last 7 years.
This conflict could be escalated and may lead to new sanctions from the United States, if OPEC+ does not take any additional actions during its meeting on Thursday. Consumers are quite unhappy with current crude prices. The higher crude prices climb, the more hardball rhetoric we may see from the U.S. Administration.
Brent crude prices are performing a correction ahead of the OPEC+ meeting and is trading close to $83.50 per barrel. The major resistance is located at $86.74, a maximum reached in January 2018. This is exactly the level where Brent crude prices reversed, showing a peak of $86.70 per barrel on October 25. It is worth noting that Brent crude prices are below the upward trend that started on August 23. We may see an even stronger correction if prices drop below $83 per barrel. If this level is passed, Brent crude prices may drop to $79.80-80 per barrel, the late September and early October levels as well as the EMA 55 level on the daily timeframe chart.
So, this time we may face the decline of crude prices after the OPEC+ meeting instead of the rise we saw before the previous OPEC+ meeting.
US OIL (WTI/USD) – Week 45 – Bearish momentum to increase.In the coming week, we are expecting the price to reach the confluence between the trendline and the resistance before making another drop and reach the $77 level.
Trade with care.
Best regards,
Financial Flagship
Disclaimer: The analysis provided is purely informative and it should not be used as financial advice. Remember that you need a plan before you start trading; so, take this knowledge and use it as a guidebook that will ultimately help you understand the market and easily predict your next move.
#OIL: Huge uptrend potential in oil hereI think we are ready for the next big rally in oil, this will cause a dramatic effect on inflation and affect earnings negatively going forward long term. I think it could reach as high as over $100 a barrel by mid August here. If so, the impact on the economy would be very large, with a delay of 6 months according to research by my mentor, @timwest
With the Iran deal on the horizon, and the recent turn of events in the OPEC meeting, supply is going to be lower than demand and the US might be at risk of losing their energy independence that Trump had achieved during his tenure (also of note is the recent ESG activist shareholder movement, really concerning for the future of investment in increasing supply to meet demand from shale companies in the US).
Consider the return to normal in air travel as a factor here as well, no one is really prepared for a move like this, and most media talking heads are repeating like parrots that inflation will be transitory, as if they were under the govt's payroll. Nasty turn of events indeed, but a good opportunity for those long value and commodities.
Cheers,
Ivan Labrie.
Brent: countertrend dealThe decision by OPEC and OPEC + on Monday to keep the plan for a gradual increase in oil production was prompted by fears that demand and prices could weaken.
The group also considered the possibility of increasing production by 800,000 barrels per day, which is almost 1% of global production, ahead of Monday's meeting.
Now the OPEC countries are more cautious, because any hasty decision could lead to a sharp drop in oil prices.
In the medium term, the instrument will be on the rise.
Today is rich in news. Taking into account this fact, as well as the strong upward movement in oil, no one canceled short-term sales for the instrument.
Proposed deal for this tool:
Entry Point - 82.85
Stop Loss - 83.80
Take Profit - 82.08
US OIL - October continues to surpriseHello Traders and Analysts,
Breakdown:
1. Note
2. Contents
3. Research breakdown
4. Education recap
5. Information on Lupa.
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged Long, due to purchasing further increments upon imbalances.
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities.
Master Key for zones
Red = Three Month
Blue = Monthly
Purple = weekly
Scarlet - Four day
Orange = Daily
Green = 8 Hour, 16hour
Grey = 4hour
Pink = 1 hour
Updated Idea: April 30th 2021
Understanding where we are now with the imbalances.
Price has tested on the weekly the $67.00 high, which was a critical double top move allowing a correction to take place bringing price back towards $61.50. This established a weekly imbalance where April 19th 2021, the previous bearish wick offered a pricing pivot point.
The Sellers had "netted" where the lowest point of the candle matched the fractal, allowing the market to create structural imbalance to add long positions.
The engineered lows lured sellers and buyers to add aggressively. .
The imbalances have netted off on the weekly to the monthly candle of February, March 2021.
Now refer to the Monthly - price of the wicks low, closed at the monthly close two months previous - resting on top - meaning, the bullish movements are still in clear progression.
Buy Zone was between 61.8 - 66.8 $
Daily Chart - buying from the retrace.
Price had made a great opportunity here for a buying opportunity whereby price will test the new established Daily imbalance.
The price has shown now a breakout of the downward corrective channel.
This is played out perfectly - where a A,B,C,D pattern has been created
see here
Fibonacci & Daily Imbalance Combination
Above the weekly imbalance block, price had surpassed and created the buying impulses, price needed to fill the wick as at 8th March 2021, and build upon the high probability of extending higher highs. Based upon the Fibonacci pattern, price established its peak "0" and once forming a -0.27 extension high, a correctional retest of the imbalance was required. This aligns with the Daily and weekly imbalance blocks.
Volume Analysis
The battle around the reactive zone is strong as the hidden battle under a monthly imbalance is a weekly imbalance, where movements create opportunities for price filling of monthly wicks. Price needed to revert from the monthly zone above $68--> to recapture correctional moves and stimulate the buying structure in place.
Where confirmations were measure above, buyers were still in control. The range of buying and selling upon a weekly bullish candle cancelled out allows range traders and short term speculators to join in the liquidity.
Note how the top of the volume range - bulls and bears back off, leaving the buyers to take over.
USD CAD vs WTI
Inverse correlation, but interesting relationship overall, as the Loonie weakens, the opportunity cost for buying from imbalances from the monthly offers the Dollar to gain traction towards the next zone.
Price also offers the WTI as the Canadian Dollar weakens, pressure of the commodity to rise.
The relationship between looks to the output of barrels.
Use the link below to look at the US table and CAD table.
US
www.tradingview.com
CAD
www.tradingview.com
Fundamental Fans:
Understanding the context behind Oil with the "disastrous" negative price of the Oil futures crash.
2020-2021.
We have seen a nice impulse into the channel and a rejection upon reaching the trendline at $53.00
Good question, based on the fact - from a technical standpoint - the sell off back in February, March 2020 - reversed on a fractal point within the market structure to the crisis of Oil supply being heavy weighted in comparison to the demand . The spike to zero was the abundance of supply which effectively the storage supply became over saturated and "worthless", the May contracts were not accepted for physical delivery and the paying for the delivery took place to prevent further storage.
This imbalance was created in which created the impulse. Price re-established itself with $30-36 zone for a further imbalance where price will now look to as a strong demand for price engineering if needed.
Here is the current cross examination of the UK Oil Vs WTI using the weekly chart.
Both are approaching a critical point in the respective price zones which both happen to be monthly imbalance zones. The correlations are gearing to a highly reactive point, so watch with caution.
Understanding the Fundamentals behind the Supply, Demand & Future Supply through inflation of cause and effect.
Oil prices and levels of inflation are often seen as being connected in a cause-and-effect relationship. Simply put with oil current at $66.00 per barrel, as oil prices move up, inflation—which is the measure of general price trends throughout the economy—follows in the same direction resulting in a higher overall price.
Keep in mind, as the price of oil falls, inflationary pressures start to ease.
Producer Price Index
This is a measurement of the rate of change in prices of said commodity , where the change in prices of the products sold is measured by the producer. The exclusion of Tax, trade margins and transport cost which are all variables a buyer of a physical will have to burden.
The PPI is a average movement of price, which are subsequently tracked by the economic indicators dealing with the price fluctuations end users have to pay at the end of the supply line.
Adding the inflation ETF into the mix, the commodity price is rising inline with both the UK oil and WTI - so again the rate of positive correlation here is showing highly probable further increments to long positions.
See below for the weekly chart.
Opec Commentary:
A gradual increase in oil output which has bolstered price, however to add to this the implications of inflationary pressures that consuming nations fear will derail an economic recovery from the pandemic.
Supplies from the US and India and China for extra supplies after oil prices surged more than 50% this year
Opec news source
Where the output has now been boosted by "400,000bpd a month until at least April 2022 to phase out 5.8 million bpd of existing production cuts - already much reduced from the huge curbs that were in place during the worst of the pandemic" Reuters.com 4th october 2021. Output policy unchanged sources say.
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No One Should Be Surprised That Energy Prices Are ExplodingMark Fisher was a presence in the natural gas futures arena in the days before electronic trading, racking up profits that made him very wealthy.
On Wednesday, September 29, Mr. Fisher told CNBC that he does not see the November natural gas futures contract coming off the board below the October contract, making the $5.50 to $5.80 level a bottom. He warned that an early cold winter could take the price to $12 as consumers in the US follow European and Japanese consumers, “freaking out” about the supply situation in the natural gas arena.
When it comes to crude oil, Mark Fisher said that NYMEX crude oil demand remains robust, and the weather is cold, the price could move from $75 to over $100 per barrel level. He went on to say that “people have been spoiled by low energy prices.” They could be in for a shocking surprise. Meanwhile, no one should be shocked as the seeds for a bull market in the energy sector were planted on January 20, 2021.
It took decades to achieve energy independence in the US
It took months to surrender it to OPEC+
Green is the future; fossil fuels are the present
Crude oil is trending towards the triple digits
Natural gas is a wild beast
It took decades to achieve energy independence in the US
For those of us old enough to remember the gasoline lines in the 1970s and the odd and even plate days where you could only fill your tank on certain days, that period marked the beginning of the US’s quest for energy independence. Over the past half-century, the country made great strides.
US ingenuity and technology allowed the nation to process corn into biofuel. The government mandates that support energy and agriculture reduces Middle Eastern crude oil imports. In the late 1970s, many young people headed for Alaska for high-paying jobs to extract petroleum from the earth’s crust and construct pipelines that carried the energy commodity to the lower forty-eight states.
Over the recent years, the US not only achieved energy independence but became a leading energy exporter. Technological advances in fracking and drilling increased output while lowering production costs. Discoveries of quadrillions of cubic feet of natural gas in the Marcellus and Utica shale regions increased reserves. Since necessity is the mother of invention, technology allowed for processing natural gas into liquid form to travel beyond the pipeline network. Today, LNG moves from the US via ocean vessels to regions worldwide where the price is substantially higher.
In March 2020, the US became the world’s leading crude oil producer with output of 13.1 million barrels per day, surpassing Russia and Saudi Arabia and pushing OPEC, the international oil cartel, into an abyss. Pricing power was in the hands of US producers with the ability to turn on production when prices rose and turn it off and turn to imports when it fell.
It took decades, but the US achieved the goal.
It took months to surrender it to OPEC+
On the campaign trail in 2020, President Biden pledged to address climate change by enforcing an energy policy that would favor alternative energy sources. Calling climate change an existential threat to humanity was a critical focus of the Democrat’s platform.
On his first day in the Oval Office, the new President issued an executive order canceling the Keystone XL pipeline project that carried petroleum from the Canadian oil sands in Alberta to Steele City, Nebraska, and beyond to the NYMEX crude oil delivery hub in Cushing, Oklahoma.
In May, amid rising energy demand, the administration banned fracking and drilling for oil and gas in Alaska. By August, the administration asked OPEC and Russia to increase production from current levels. The cartel summarily rejected the request.
In March 2020, the US was an energy powerhouse. In September 2021, it surrendered control to other worldwide producers. After suffering under the weight of shale oil and output over the past years, OPEC+ is now positioned to squeeze higher prices from US and other consumers. It took less than one year and one-half for the balance of power to shift.
Last week, US generals and military leaders told Congress the US lost the twenty-year war in Afghanistan. It took less than eighteen months to lose control of energy.
Green is the future; fossil fuels are the present
There is no doubt that alternative energy is the future. It will take decades to fund and build wind, solar, nuclear, and other alternative energy sources to the point where fossil fuels are obsolete. Crude oil and natural gas may eventually go the way of whale oil. However, most cars in the US and worldwide continue to run on fossil fuels, which is not changing any time soon.
There are roughly 250 million vehicles in the US. The number has been stable over the past years. According to the US Energy Information Administration, 78% of the vehicles sold in the US will continue to run on gasoline twenty-five years from now.
Crude oil and natural gas continue to power the world. Fossil fuels are essential for industry and individuals. Increased regulations and policies to curb output will only serve to push prices higher, as we have seen over the past months. Moreover, no rational company is going to invest in US hydrocarbon production given the regulatory environment. OPEC and Russia are in the driver’s seat with their hands on the pricing wheel.
Anyone shocked by the price action in crude oil and natural gas futures markets likely thought that political promises to address climate change would never occur. This time, they were dead wrong.
Crude oil is trending towards the triple digits
US production put the former President in a position to ask OPEC+ to cut production when the price of crude oil fell like a stone at the beginning of the 2020 global pandemic. OPEC and Russia reduced output by an unprecedented 7.7 million barrels per day. NYMEX crude oil fell to a record low at negative $40.32 per barrel briefly before turning higher.
The monthly chart of nearby NYMEX crude oil futures highlights the explosive move from negative $40.32 in April 2020 to the most recent high at $76.98 in early July 2021. After correcting, crude oil has been moving towards a test of the recent high, trading to $76.67 per barrel last week and closing near the $76 level. The recent high was marginally above the peak from 2018 at $76.90, a technical gateway to the next resistance level from 2014 at over $100 per barrel.
NYMEX WTI crude oil futures are the pricing benchmark for around one-third of the world’s petroleum producers and consumers. The other two-thirds, including the Middle East, use the Brent futures benchmark.
The chart of nearby Brent crude oil futures shows the price reached the lowest price of this century at $16 per barrel in April 2020. Last week, it probed above $80 for the first time since October 2018. Technical resistance stands at the 2018 $86.74 high, a gateway to a triple-digit price for Brent crude oil.
OPEC+ would rather sell one barrel of crude oil at $100 than two at $40 per gallon. It would be comical if it weren’t tragically ironic that when the US administration asked the cartel to cut production, it rejected a request to increase output by the next administration after cooperating with the previous administration’s request for a production cut.
Natural gas is a wild beast
Crude oil has rallied substantially since April 2020 and was sitting at the highest price since 2018 at the end of last week. Natural gas, the other energy commodity the US had dominated, has gone ballistic on the upside.
In June 2020, natural gas fell to its lowest price in a quarter of a century when it traded at $1.432 per MMBtu.
At the low, the ultimate value investor put $10 billion into the natural gas market. Warren Buffett’s Berkshire Hathaway bought the transmission and pipeline assets from Dominion Energy for $6 billion in assumed debt and $4 billion in cash. The deal was announced in early July 2020. Mr. Buffett bought the low.
The monthly chart shows the parabolic rally that has taken natural gas from $1.432 in June 2020 to a high of $6.318 per MMBtu last week. While natural gas pulled back to around the $5.50 level, the price was still nearly quadruple the level when Warren Buffett increased Berkshire’s exposure to all interstate natural gas transmission in the US from 8% to 18%.
In an interview on CNBC on Wednesday, September 28, Mark Fisher said that, given the demand situation in Europe and Asia, a cold winter in the US could push natural gas futures as high as $12 per MMBtu, a level not seen since 2005 and 2008. Mark Fisher knows the natural gas market as he was the most successful energy floor trader on the NYMEX exchange before electronic trading.
Are you surprised that crude oil and natural gas prices are exploding and are likely to move much higher over the coming months and years? You shouldn’t be; it is just the elected US government fulfilling its promises at the top of the 2020 platform. We expect higher lows and higher highs to continue as US energy policy is the most significant factor for the coming years. OPEC+ is back in control, and the cartel’s mission is to provide its members with the highest price possible while “balancing” supply and demand in the energy market. With the US production declining as it takes a greener path, many will be walking rather than driving on the road to shortages and higher prices.
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Trading advice given in this communication, if any, is based on information taken from trades and statistical services and other sources that we believe are reliable. The author does not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects the author’s good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice the author provides will result in profitable trades. There is risk of loss in all futures and options trading. Any investment involves substantial risks, including, but not limited to, pricing volatility , inadequate liquidity, and the potential complete loss of principal. This article does not in any way constitute an offer or solicitation of an offer to buy or sell any investment, security, or commodity discussed herein, or any security in any jurisdiction in which such an offer would be unlawful under the securities laws of such jurisdiction.
Could Crude at $100 per Barrel Be a Reality?The question of the U.S. Debt limit is off the agenda at least for two months after President Joe Biden signed a funding bill to prevent government shutdown and allow funding through to December 3. Investors held their breath last week to see where stock indexes would land, and the answer is they rebounded by 0.82-1.43%.
The new week starts with the OPEC+ meeting amid expectations that the oil cartel and its allies would rise crude production above the scheduled 400,000 barrels per day limit. OPEC+ may revise quotas for November as the demand for crude rose unexpectedly high. Western countries are the most worried about rising crude prices and consider that the additional volumes of crude production may bring prices down sharply. Brent crude benchmark prices recently spiked to $80.75 per barrel.
However, some believe that the gas crisis and soaring gas prices may instigate crude prices to jump to $100 per barrel, and this may spur a global economic crisis, according to the Bank of America cited by Bloomberg.
The price for gas in Europe is already an equivalent to the price of crude at $190 per barrel. Several European gas-consuming companies have filed for bankruptcy. Crude prices have only 10% left from the peaks of 2018. If Brent crude prices would hold above $86-87 per barrel technically such targets could be achieved, and may move Brent crude prices even above $115-117 per barrel.
However, it is too early to dive into wishful thinking as we have the situation now, and now we are at the important crossroads as the resistance line that started in 2008 and is crossing peaks in 2012 and 2014 is crossing the level of $79-80 per barrel, where the current Brent crude price is located. So, price is testing this resistance for the fourth time now, while the last time was in 2014, which makes a huge gap of 7 years. So, we may not consider as certain that this time this test would finally lead to a breakthrough. So, we may not also exclude the possibility that the price would fail to hold above $80 per barrel and would follow the 13-year downward trend. In this case Brent crude prices may plunge to $70 per barrel, at the support line of the trend that started in March 2020.
XAU/USD weekly analysisIn this post, we will analyze the weekly Forex gold with the symbol XAU/USD.
Fundamental analysis
According to a previous analysis of the EUR/USD , fundamental news will be released next week, which could cause strong volatility.
At the beginning of the week, when the OPEC meeting takes place and US banks are closed, we expect investors to pay attention to gold. They probably prefer to buy gold over dollars and oil, which creates an uptrend to near the previous floor.
Crossing the previous floor
If the previous floor, the 1790 range, is broken, this analysis will be incorrect and the gold trend will be bullish, otherwise it is still in a bearish trend.
Also, if it goes according to the analysis, the gold will fall close to the trend line and react to this range.
Signal
Within 1 hour, we see a cup and handle pattern. Of course, I agree that these patterns are old and unreliable, but they can be identified as a signal for the growth of gold near the site.
Education excerpt: OPECThe Organization of the Petroleum Exporting Countries (OPEC)
The Organization of the Petroleum Exporting Countries (OPEC) is a permanent intergovernmental organization with main goal to coordinate and unify the petroleum policies of its member countries. This pertains mainly to securing fair and stable pricing in the oil market; efficient and regular supply of petroleum to consuming nations and fair return on capital to the producing countries.
The OPEC was established in Baghdad, Iraq in 1960 by five countries. Founding countries were: Iraq, Islamic Republic of Iran, Kuwait, Saudi Arabia and Venezuela. One year later the organization was joined by Qatar in 1961. After that Indonesia and Libya followed in 1962. United Arab Emirates joined the cartel in 1967 and Algeria in 1969. Then Nigeria became member of the OPEC in 1971, Ecuador in 1973 and Gabon in 1975. Few decades later, Angola joined the OPEC in 2007, Equatorial Guinea in 2017 and Congo in 2018.
Ecuador suspended its membership in 1962. However, it rejoined the cartel in 2007. But then again in 2009 Ecuador withdrew its membership from OPEC. Similarly, Indonesia suspended its membership in 2009 and rejoined the cartel in 2016 only to leave it again in 2016. Gabon also suspended its membership in 1995. Although, Gabon reactivated its membership in 2016. Qatar was the last country to terminate its membership in 2019.
Current members:
1. Iraq
2. Iran
3. Kuwait
4. Saudi Arabia
5. Venezuela
6. Libya
7. United Arab Emirates
8. Algeria
9. Nigeria
10. Gabon
11. Angola
12. Equatorial Guinea
13. Congo
The OPEC's executive organ is called the Secretariat and it is run by the Secretary General. Secretariat was originally established in 1961. It also functions as headquarters for the organization. In the beginning, OPEC had its headquarters in Geneva, Switzerland for five years. However, OPEC's headquarters were moved to Vienna, Austria in 1965. Executive organ is responsible for implementation of all resolutions passed by the Conference. Secretariat also conducts research and fullfills all decisions made by the Board of Governeros.
The Secretary General is the representative of the OPEC who simultaneously acts as Executive of the Secretariat. The Secretary General is electable role and its term last three years. Although, there is possibility to renew this term once. The Secretary General is assisted by the Office of the Secretary general and several other officers and staff members of the OPEC. The Office of the Secretary general helps the executive chief of the Secretariat to maintain efficient relations with relevant international organizations and governments. Another important organ of the organization is the Legal Office which supervises legal matters of the Secretariat and provides legal advice to the Secretary General. In addition to that, there is also the Research Division that consists of three departments: Data Services, Energy Studies and Petroleum Studies. The Research Division is responsible for conducting research with regards to the energy and related matters. Infrastructure and services are provided by the Support Services Division.
OPEC Fund
The OPEC Fund for International Development is international finance development institution that was established in 1976. It consists of 12 members: Algeria, Ecuador, Gabon, Indonesia, IR Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, the United Arab Emirates and Venezuela. Its purpose is to provide financial help to the developing countries and support advancement in these low-income and middle-income countries.
Disclaimer: This content serves solely educational purpose.
UKOIL monthly technical analysis !TVC:UKOIL
Hi everyone , I hope you're all fine .
- UKOIL has recently broke downtrend and also the price had a pullback to the broken trendline
- Also the price is is moving in a ascending channel
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the next resistances would be :
1- 86.70 (which is the top of channel and also last resistance
2- 116.00 (which is a nice resistance with 4 touches since 2012 and 2016 until now
now let's see some fundamental info about OIL :
- US crude inventories fell more than expected last week, hitting a three-year low, according to the US Petroleum Institute and the US Energy Information Administration. The upward trend in natural gas is likely to lead to increased demand for black gold.
This year, crude oil has grown by more than 80 percent since the beginning of the year, as the global economic recovery from the Corona outbreak significantly boosted demand. On the supply side, OPEC Plus members are also gradually reducing their production restrictions.
In addition, Hurricanes Ida and Nicholas affected production in the United States. The Gulf of Mexico was hit hard in late August (early September) and September (early October), respectively.
Given the imminence of the fourth quarter and the winter season in the Northern Hemisphere, some investors predict a continued upward trend in prices.
The Goldman Sachs Group (NYSE: GS) said the market deficit was higher than expected, raising Brent oil forecast from $ 10 to $ 90 a barrel at the end of the year .
Source : Investing.com
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so what's your opinion guys ??
we'd be glad to see your idea in comments .
Pure Technical WTI TradeIn this analysis I do NOT consider fundamental factors that significantly influence the oil price. Thus I only focus on time period as short as can possibly be on technical basis.
There is some convincing technical setup arising on WTI H4 timeframe with good signals each of which is worth taking into consideration, at least to me.
1) Broken short term descending trend line on attempt #4.
2) The price has returned exactly to the 50% fibo area and has not closed below the local support area so far.
3) RSI shows gained momentum on highlighted support area with open space up.
4) Latest candle rejected the selling pressure and printed the "Hammer" formation on significant confluence level (look at #2).
5) (ok just a little bit of fundamentals) There is no sight of significant price changes since OPEC has no reason to change its plan of production revival and covid seems to be under control (hopefully).
To me RRR of 2 with highlighted limit orders makes sense in short term. Let me know what you think about that!
The next 3 weeks should be fun.We plowed through new highs last week as I anticipated in a bull case last week.
The green levels in this weeks chart are last weeks major daily support / resistance levels from a couple order flow experts on fintwit.
First thing I learned in stocks was that when the Normies (normal people) know, it's time to go.
The 19th* dip trend I've been following since last week has started hitting MSM.
With that in mind, I find myself second guessing the 19th dip prediction this coming September and instead planning the extremes that could occur instead.
1. We could start unwinding OPEX/VIX early as big money tries to get ahead of the normies buying the 19th dip.
2. More explosive events and FUD fill the market and we actually run above the 1.5Y median like we did last end of September.
3. We stay in tight, low volume trading ranges, accumulate at the 1.5y median followed by a spring event, distribution/bull trap and a sell off into VIX / OPEX and Buy the Dip 19th*.
I love this game.
On OPEC & OILSince May 2021, S&P 500 has gained almost 10%, while Copper/Oil ratio has lost 52%; which means oil prices are relatively higher than the Global economic growth capacities.
IEA reported the same idea on Global OIL demand this week, which is totally in contrast with OPEC's demand assessments noted in it's August report.
Since these high prices are weighing on U.S. Trade Balance & causing inflationary pressures, White House has already reached OPEC for lower prices.
While OPEC is counting on strong Global growth to reach it's basket pricing, a failure on that could force the Cartel to cut it's prices; The bad scenario is a continued divergence between OPEC basket pricing & the global growth capacities, which could at last end in a pressure on World Economies which are already in ultra low Interest Rates & looming Tapering stages.
I believe the above divergence scenario has a little chance to happen, But still a possibility since OPEC miscalculation isn't new.
Whether OIL prices lower to match the world growth capacity or world recovery reach the high energy prices according to OPEC's anticipation, is to be judged by the unveiling Fundamental Factors including Delta variant outbreak & vaccines effectiveness.
However any prolonged divergent policy, despite being unlikely, could cause recessionary pressures.
Breaking: The OPEC report is issuedOPEC monthly report was issued a few minutes ago, and the report was not positive for OPEC+ and the oil-producing countries within the group, led by Saudi Arabia. OPEC kept its forecast for oil demand in 2021 unchanged at an increase of 6 million barrels per day, bringing the average to 96.6 million barrels per day, and also kept its forecast for the growth of oil demands in 2022 by 3.3 million barrels per day, bringing the average production to 99.86 million barrels per day.
While OPEC+ raised its expectations for an increase in the production of oil-producing countries outside the group by 840 thousand barrels per day, to reach an increase of 2.9 million barrels per day, with a total average of 66.9 million barrels per day in 2022.
It also raised its forecast for the production growth of oil-producing countries outside the group in 2021 by 270,000 barrels per day to reach 1.1 million barrels per day, with a total average of 64 million barrels per day.
US Oil - Sell Off Equal highs got raided & Price came back to institutional candle. Looking for minor pullback to enter sell.
