United States Oil (USO) holds ground at a more than 2-week low

United States Oil (USO) holds ground at a more than 2-week low

United States Oil (USO) holds ground at a more than 2-week low

Oil settled on a mixed note Thursday, with U.S. benchmark prices posting a slight decline but global benchmark prices rebounding from the three-week low they hit a day earlier.

A monthly report from the International Energy Agency hinted at an coming slowdown in crude demand and revealed an uptick in global supplies. Traders also looked to the resumption of Libyan oil exports and mulled the impact of the U.S.-China trade dispute on the global economy, and oil demand.

August West Texas Intermediate crude CLQ8, -0.01% the U.S. benchmark, edged down by a nickel, or less than 0.1%, to settle at $70.33 a barrel on the New York Mercantile Exchange—the lowest since June 25. Prices also briefly hit lows under $70 a barrel for the first time in over two weeks. They dropped 5% Wednesday.

September Brent crude LCOU8, -0.35% rose $1.05, or 1.4%, to $74.45 a barrel on the ICE Futures Europe exchange. It recouped some of Wednesday’s nearly 7% drop to $73.40 a barrel, which was the lowest settlement since June 21.

The “energy selloff became exhausted” by Thursday afternoon, “at least for the near term, after both Brent and WTI futures tested but held important, respective support levels,” Tyler Richey, co-editor of the Sevens Report, told MarketWatch.

“The profit taking rally in Brent outpaced WTI into the afternoon,” in part because Brent had “become further overextended to the downside after it declined well over a dollar more than WTI on Wednesday,” he said.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 14.02.

The projected upper bound is: 15.16.

The projected lower bound is: 13.65.

The projected closing price is: 14.41.

Candlesticks

A white body occurred (because prices closed higher 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 23 black candles for a net of 3 white candles.

A bullish harami occurred (where the current small white body is contained within an unusually large black body). During a downtrend this pattern implies an end to the decline as the bears appear to have exhausted themselves.

During an uptrend (which appears to be the case with UNTD ST OIL FUND) the bullish harami pattern is bearish as the bears appear to be gaining strength as the bulls weaken.

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.

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 29.2710. This is not an overbought or oversold reading. The last signal was a sell 5 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 52.20. 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 sell 7 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 -58. This is not a topping or bottoming area. The last signal was a sell 6 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 0 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed up 0.080 at 14.390. Volume was 17% above average (neutral) and Bollinger Bands were 91% wider than normal.

Open High Low Close Volume___
14.380 14.450 14.140 14.390 23,510,408

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 14.83 14.04 12.54
Volatility: 35 34 28
Volume: 22,637,298 21,233,570 18,589,618

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 14.8% above its 200-period moving average and is in an upward 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 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 10 periods.

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