United States Oil (USO) futures face headwinds as U.S.-China trade tensions persist

United States Oil (USO) futures face headwinds as U.S.-China trade tensions persist

United States Oil (USO) futures face headwinds as U.S.-China trade tensions persist

indications that OPEC will not waiver in its bid to drain oversupply.

Crude futures recovered on Wednesday after Saudi Arabia’s influential oil minister brushed off pressure from President Donald Trump to “take it easy” on price-boosting production cuts. Trump’s warning to Saudi Arabia and its fellow OPEC members caused oil prices to sink more than 3 percent on Monday.

But on Thursday, traders said the oil market was dealing with several headwinds, as U.S.-China trade tensions persisted, the Chinese economy showed signs of slowing and record U.S. production undermined OPEC-led output curbs.

U.S. West Texas Intermediate crude rose 28 cents, or half a percent, settling at $57.22, just a few cents shy of last week’s 2019 closing high.

Overall, the bias in prices is: Upwards.

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

By the way, prices are vulnerable to a correction towards 11.55.

The projected upper bound is: 12.69.

The projected lower bound is: 11.26.

The projected closing price is: 11.97.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 33 white candles and 17 black candles for a net of 16 white candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

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 57.7381. This is not an overbought or oversold reading. The last signal was a sell 3 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 62.07. 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 43 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 83. This is not a topping or bottoming area. The last signal was a sell 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 buy 8 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed up 0.060 at 11.950. Volume was 54% below average (consolidating) and Bollinger Bands were 45% narrower than normal.

Open High Low Close Volume___
11.920 11.993 11.850 11.950 14,269,061

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 11.78 10.90 13.10
Volatility: 28 43 39
Volume: 19,459,816 27,513,872 25,057,020

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 8.8% below its 200-period moving average and is in an upward trend. Volatility is relatively normal 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 35 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

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