WTIC West Texas Intermediate Crude Oil Weekly Chart; Negative Divergence Spankdown

Oil receives the neggie d spankdown last week (red lines). Price comes up for the matching high but all the indicators were negatively diverged (sloping down). Thus, price is out of gas, oil is out of gas, and down she goes. The MACD creates a negative cross with its moving average and the money flow is printing a lower low, weak and bleak, wanting to see a lower low in price even if a bounce occurs, on a weekly basis.

The upper band was violated so the middle band, which is also the 20-wk MA, is in play and although it came down in the vicinity it did not touch the 105 handle so that is likely going to happen. The bottom band is also in play at 87 which is strong price support.

So 105 should occur, and then the blue line shows support at 103-104, and then 95, then 87. The daily chart remains on the weak side so lower lows would be expected on the daily basis. Oil may pull back for a few weeks.

On the WTIC monthly chart, the indicators were all neggie d except for the MACD line that still has some gas in the oil tank. RSI, histo, stoch's and money flow are all neggie d. Thus, the daily and weekly charts want to see more price sogginess for a week or two, maybe a 1 to 4 week period taking trading well into July. At that time, another rally would be expected, on the monthly basis, to satisfy the MACD that is not finished as yet.

The way oil is set up is interesting. Probably not what most Wall Street analysts are predicting. Maybe some Chicago guys are. When price likely comes back up for a matching and higher price high, say in late July or August, that's all folks. The MACD line on the monthly chart will go neggie d and join the other chart indicators and the long-term top for oil would be in. We are talking months and perhaps a year or two.

There are wild cards such as war that could send oil prices higher on a whim. But going by the technicals alone, oil prices should remain soggy for 1 to 4 weeks likely targeting the 95-105 zone. Interestingly, during this time, the lower standard deviation band and 50-wk MA will be ramping higher and may form a confluence at 95-ish that price may seek. The weekly chart will form positive divergence and tell you when the selling is over and the rally will begin (early July maybe mid-July).

Price should then return to the highs during July/August and this is likely the highest price oil will see for a year or two unless global events drastically change the picture. In this dire loing-term scenario, you know what it means, don't you? Yes. In a recession, or depression, you don't need no steenkin' oil. 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.

Note Added Wednesday Afternoon, 6/22/22, at 5:03 PM EST: WTIC crude oil drops to 101.53 and closes at 106.19 smack-dab on the 20-week MA at 106.37. Oil must choose up or down from here, bounce, or die. The HOD is 109.76, testing the 50-day MA at 109.40 where it receives a smack down, so obviously oil is respecting the moving averages.

Note Added Saturday, 6/25/22: Over the past week, WTIC prints a low at 101.53 and high at 111.16 now at 107.62. Oil is holding on to the 20-wk MA at 106.45 with all its might. If the 106 fails, sub 100 is likely.