Sunday, August 14, 2016

WTIC West Texas Intermediate Crude Oil Weekly Chart Inverted H&S

Oil displays the yellow inverted head and shoulders (H&S) pattern. The neckline is at 50 and head at 25-30 so a breakout above 50 would place 75-ish in play. It may be a formidable task, however, to rise above 50. The ADX pink box shows the strong trend to the downside during late 2014 all of 2015 and into early this year. That strong downtrend has petered out. Keystone highlighted the universal possie d (green lines) across all indicators early this year and the easy oil rally call plays out as predicted.

Price staggers sideways and the indicators are not tipping their hand just like the US dollar index chart. The sideways neon channel is in play at 38-50 with oil at 44-ish in the middle. Oil bears win big under 37-38. Oil bulls win big above 50. The expectation is for sideways choppiness to continue without a breakout or breakdown in the near future. Oil may stagger through 37-50 for the remainder of the year.

The central bankers continue to control the markets with their multiple years of non-stop intervention. The announcements from global central banks, along with the Federal Reserve, sends the dollar to and fro, and commodities and oil move inverse to the dollar so they are moving in a sideways choppy pattern. The central bankers are the market.

The choppy sideways behavior may indicate that markets are simply waiting for a shoe to drop. For now, traders remain confident in the central banks to keep stock markets elevated. The crack in the game likely occurs when credibility and confidence is lost in the central banker intervention. The FOMC's credibility takes a hit this year calling for four rate hikes and there may end up being zero hikes. How is that for forecasting from the Fed heads? Chair Yellen is busy wiping egg off her face this year but as long as traders believe in her obscene Keynesian policies, the party continues. 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.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.