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BEARISH RATING - XLE (SPDR SELECT SECTOR - ENERGY)It's been about seven sessions since we first issued our real time rating on XLE as bearish, and we still believe there will be opportunity to the downside. Volatility should continue as headline risk prompts uncertainty in the markets. Even if Saudi Arabia did happen to freeze or reduce production, it could not be enough in the long-term to offset production by Iran, Iraq, Russia and US shale producers. Furthermore, as we stated well over a year ago, the continuously slowdown in global economic growth will put a damper on crude prices. Here is our note from 9.14.16: Fundamentally, we do not see a meaningful resolution between Saudi Arabia and Russia curtailing their massive crude production, in part do to the unwillingness of Iran to freeze production until it reaches 4 m/bbl per day in production. With Russia - and most of OPEC - continuing course, any production cuts by domestic producers will be offset, and the supply glut will continue. What is troubling, too, is the IEA reduced its demand forecasts by 100,000 barrels due to weaker demand from Asia. The report suggested that the supply-demand imbalance will last until the first half of 2017. If subscribers remember, we foretasted, in August 2015, that demand would continue to slow due to the global slowdown and that Chinese demand would wane. The inability for the consensus to forecast the sharp decline in global economic growth has left crude prices quite volatile. We expect ongoing EIA inventory data to favor crude bears as the industry heads into the seasonally weak winter months. Technically, a break below $68 will press ascending support. We like the technical indicator make-up that suggests that the next leg of selling is beginning as long as it is supported by key fundamental factors. As bulls continue to unwind longs, the z-score will turn bearish which we prefer on the short-side until -1.5 to -2. Bearish targets are set up on key support. Rating Specifics : Signal Trigger: $67.98 Signal Threshold: $70.02 Signal Opportunity: $60 R/R Ratio: 3.91 Duration: 1 to 3 months _______________________________________ Current subscribers get access to research and analysis spanning multi-asset classes, and real time ratings is a unique way to put research into action. If you would like to be contacted about MacroView Research and interested in subscribing, please visit macroview.co
AMEX:XLE
by MacroView_Research
USOIL Head and Shoulders PatternUSOIL is forming a Head and Shoulders pattern on a medium/long term timeframe; it bounced off of the $26 dollar mark, allowing oil prices to rise to a high of approximately $52 a barrel, paying off handsomely for oil bulls. However, now concern is increasing as over extension and limited profit potential, oil bulls are beginning to take profits as selling pressure increases. I'm going to be shorting this from approximately 46 dollars with a stop loss at around 48 dollars. The first resistance point in question is 37.8 then 26-26.1. I suggest looking for a reversal to confirm the Head and Shoulders pattern. Thank you for viewing my analysis.
FX:USOILShort
by UnknownUnicorn253523
10
Setup for long on OilIt looks like a cup and handle is pattern is in the process of forming, right now we are in the consolidation portion of the handle, any break would see a rise upwards easily into the 60s.. I do not have a specific target price, but it looks quite attractive to enter at this point in time for an upward move. The recent EIA report was supposedly bearish, but looking at the production and import figures, I would say it was still borderline with the main emphasis on weak demand.
FX:UKOILLong
by jayt88