United States Oil (USO) Companies Set to Benefit From Saudi Supply Disruption

United States Oil (USO) Companies Set to Benefit From Saudi Supply Disruption

United States Oil (USO) Companies Set to Benefit From Saudi Supply Disruption

Some U.S. oil companies are positioned to gain from the attacks on Saudi Arabia’s facilities over the weekend and an attendant rise in crude prices.

The biggest moves could come from U.S. oil companies with a sizable short interest, including Apache Corp., Continental Resources Inc., Concho Resources Inc., Devon Energy Corp. and Noble Energy Inc., according to analysts at Houston-based Tudor Pickering Holt & Co.

U.S. President Donald Trump said on Sunday he authorized the release of oil from the U.S. Strategic Petroleum Reserve (SPR) if needed in a quantity to be determined because of Saturday’s attack on Saudi Arabia’s oil facilities.

“Based on the attack on Saudi Arabia, which may have an impact on oil prices, I have authorized the release of oil from the Strategic Petroleum Reserve, if needed, in a to-be-determined amount sufficient to keep the markets well-supplied,” Trump said on Twitter.

“I have also informed all appropriate agencies to expedite approvals of the oil pipelines currently in the permitting process in Texas and various other States.”

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 12.16.

The projected lower bound is: 10.70.

The projected closing price is: 11.43.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 22.9205. This is not an overbought or oversold reading. The last signal was a sell 2 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 46.74. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 64 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -51. This is not a topping or bottoming area. The last signal was a sell 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 22 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed down -0.030 at 11.440. Volume was 51% below average (consolidating) and Bollinger Bands were 44% narrower than normal.

Open     High      Low     Close     Volume___
11.490 11.525 11.383 11.440 14,074,354
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 11.65 11.66 11.73
Volatility: 41 40 40
Volume: 27,450,642 28,416,062 27,297,634

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

UNTD ST OIL FUND is currently 2.5% below its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of USO at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on USO and have had this outlook for the last 7 periods.

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