United States Oil (USO) prices can’t shake off the coronavirus

United States Oil (USO) prices can’t shake off the coronavirus

United States Oil (USO) prices can’t shake off the coronavirus

Oil prices steadied on Monday in Asia after posting a fifth straight weekly loss.

U.S. Crude Oil WTI Futures inched up 0.1% to $50.37 by 1:27 AM ET (05:27 GMT), while international Brent Oil Futures also gained 0.1% to $54.52.

Combined losses over five weeks stood at more than 22% for both benchmarks, leaving them into bear market territory.

“Oil prices can’t shake off the coronavirus,” Phil Flynn, senior market analyst for energy at the Price Futures Group in Chicago, said.

“Conflicting reports about how well the virus is being contained is raising fears about economic growth” even as OPEC struggles to find a way to support the market from collapse, Flynn said.

The coronavirus outbreak which has killed more than 900 people and infected 40,000 people in China were continued to be cited as a major headwind for the oil market.

“Oil prices can’t shake off the coronavirus,” Phil Flynn, senior market analyst for energy at the Price Futures Group in Chicago, said.

“Conflicting reports about how well the virus is being contained is raising fears about economic growth” even as OPEC struggles to find a way to support the market from collapse, Flynn said.

Meanwhile, Russian Energy Minister Alexander Novak stalled in giving his government’s assent to suggestions from OPEC’s suggestion that the group and its allies would cut an additional 600,000 barrels per day in supply. He noted that Moscow needed more time to assess the situation, adding that U.S. crude production growth would slow and global demand was still solid.

Technical Indicators

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 11.63.

The projected upper bound is: 11.10.

The projected lower bound is: 10.00.

The projected closing price is: 10.55.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 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 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 46.5909. This is not an overbought or oversold reading. The last signal was a buy 1 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 27.33. 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 22 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 buy 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 sell 21 period(s) ago.

Rex Takasugi – TD Profile

UNTD ST OIL FUND closed down -0.160 at 10.580. Volume was 3% below average (neutral) and Bollinger Bands were 101% wider than normal.

Open     High      Low     Close     Volume___
10.600 10.720 10.535 10.580 20,887,728
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 10.84 12.10 11.89
Volatility: 33 29 39
Volume: 30,284,478 20,296,870 26,010,046

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 11.0% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. 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 17 periods. Our momentum oscillator is currently indicating that USO is currently in an oversold condition.

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