Monday, December 8, 2014

WTIC West Texas Intermediate Crude Oil Weekly Chart Oversold

The WTIC weekly chart is a sick puppy. The collapse is astounding from 108 to 65 (current print is down to 64.55 as this is typed; the red dot) a drop of -40% in less than six months time. That is called a crash. The stochastics are oversold, in the basement, and positively diverging wanting price to bounce from here. Ditto the flat RSI, however, the other indicators such as histogram, MACD line and money flow are weak and bleak wanting further lower lows in price in early 2015.

The previously posted WTIC daily chart is set up to base and bounce in the near term which jives with the possie d for the stochastics and RSI above on the weekly. This hints at a recovery for oil on the come, say this month of December, but then price will venture lower after any recovery move as long as the indicators are weak and bleak (red lines). The 200-week MA is rolling over and turning into a negative slope which is a very dire indication for oil. This can easily usher in multi-month and multi-year weakness going forward. If you follow the long-term falling wedge pattern in light green lines the projection for a base for oil would be 55-60 in Q1 and Q2 of 2015.

The projection is for a bounce to occur in the near term, in December, but the indicators want lower lows in price going forward so price will come back down. The true bottom for oil is not likely until early next year. Price may stagger through 55-75 for the first half of next year. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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