United States Oil (USO) ongoing supply cuts led by producer club OPEC

United States Oil (USO) ongoing supply cuts led by producer club OPEC

United States Oil (USO) ongoing supply cuts led by producer club OPEC

Oil prices rose early on Monday, with Brent hitting its highest level since November, driven up by a decline in U.S. drilling activity and ongoing supply cuts led by producer club OPEC.

Brent crude futures were at a November 2018 high of $72.58 per barrel at 0028 GMT, up 0.8 percent from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $64.55 per barrel, up 0.9 percent from their previous settlement.

“The path of least resistance remains higher (for oil prices),” said Shayne Heffernan, CEO and Founder of Heffx, pointing to Saudi supply cuts, a decline in the U.S. rig count and supply disruptions from Libya to Venezuela as reasons for a tight market.

Outside the United States, the Organization of the Petroleum Exporting Countries (OPEC) has led supply cuts since the start of the year aimed at  tightening global oil markets and to propping up crude prices.

Brent prices have risen by more than a third this year, while WTI has climbed more than 40 percent over the same period.

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 12.42.

The projected upper bound is: 13.81.

The projected lower bound is: 12.91.

The projected closing price is: 13.36.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 white candles.

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 67.4417. This is not an overbought or oversold reading. The last signal was a sell 4 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 66.82. 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 5 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 47. This is not a topping or bottoming area. The last signal was a sell 5 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 1 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed up 0.040 at 13.320. Volume was 50% below average (consolidating) and Bollinger Bands were 7% wider than normal.

Open High Low Close Volume___
13.300 13.340 13.230 13.320 12,393,091

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

Moving Averages: 10-period 50-period 200-period
Close: 13.31 12.26 12.87
Volatility: 18 24 37
Volume: 18,143,660 19,995,868 24,921,766

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 3.5% above 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 30 periods.

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