United States Oil (USO) edges lower ahead of G-20

United States Oil (USO) edges lower ahead of G-20

United States Oil (USO) edges lower ahead of G-20

Oil prices dipped on Tuesday, weighed down by uncertainty over the US-China trade war and signs of increased global crude production, but losses were limited by expectations that crude exporters would agree to cut output at an upcoming Opec meeting.

Brent crude futures fell 27 cents to settle at US$60.21 a barrel. US West Texas Intermediate (WTI) crude futures fell 7 cents to settle at US$51.56 a barrel.

Prices fell to their lowest since October 2017 last week – Brent at US$58.41 and WTI at US$50.15.

Both crude benchmarks are down more than 30 per cent since early October, depressed by an emerging supply overhang and widespread financial market weakness.

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 13.04.

The projected upper bound is: 11.73.

The projected lower bound is: 10.03.

The projected closing price is: 10.88.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 2 white candles and 8 black candles for a net of 6 black candles. During the past 50 bars, there have been 17 white candles and 30 black candles for a net of 13 black candles.

A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 15.9760. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 6 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 23.68. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 37 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 -122.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 3 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 sell 33 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed up 0.010 at 10.950. Volume was 52% above average (neutral) and Bollinger Bands were 111% wider than normal.

Open High Low Close Volume___
10.970 11.080 10.644 10.950 36,086,060

Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 11.53 13.99 13.77
Volatility: 69 42 34
Volume: 48,575,548 28,705,300 22,028,460

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 20.5% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of USO (mildly bearish). Our trend forecasting oscillators are currently bearish on USO and have had this outlook for the last 29 periods. Our momentum oscillator is currently indicating that USO is currently in an oversold condition.

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