Yea, whilst i’m sat here babysitting this monstrosity of a trade 
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OK I will just nip off and sell a few trillion S&Ps and push it through the Friday close for you and see if that helps! 
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That would be much appreciated - I only put this trade on because it looked tasty, and because I wanted an extravagant new year get away. Now it’s looking like i’ll be stuck with the dog and a bottle of fizz.
All joking to one side though, WTI is really TA sensitive, more so than FX in my opinion, which i’m starting to like. The downside to this though is that I don’t find news and geopolitical events interesting research, i’ve always been a chartist (first), and the occasional news watcher (second). It will be interesting to see how well it respects standard TA - however my first filter will certainly be the overall trend unlike the way I trade FX.
Having watched Crude closely for 18 mths now, I fully agree with you. Not only is it very TA sensitive but the price follow-through is usually greater than with FX and very rewarding!
…and, of course, there is only one product to think about instead of two as in a currency pair - which suits my limited supply of brain cells! 
How to Trade Oil: Crude Oil Trading Strategies & Tips
With Brent trading more volume than WTI it might be a better index to follow but WTI may influence USDCAD more heavily than BRENT due to where the oil is mainly drilled.
Nice little primer
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My own personal opinion, would be to completely separate out the thought of trying to relate a ‘global’ commodity to a certain FX pair - for one they act entirely different, even more so in today’s day and age.
We are seeing some long tails now on the 4H oil chart today:
And the S&P failed to follow-through on the break below the Friday close. On the basis on what doesn’t go down must go up I took a quick opportunist long trade on S&P up to the daily pivot. (should have stayed with it longer as it happens!). This was my first trade on S&P for absolutely years! Must do it more often 
:
S&P 1m.:
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Since one of the major concerns right now in the oil markets is, quite rightly, the state of the world’'s economies, it is no surprise that oil prices have recently been shadowing the mood of equity indices, This has been the case all this week, including yesterday, up until we drew close to the first of this week’s inventories data releases by the API, at which point the WTI temporarily let go of the hand of its equity mentors and just splashed around last week’s closing levels.
The API figure was a surprise in that it actually posted a build of nearly 7 mill barrels for the week ending 21.12. instead of the anticipated draw of around 3 mill barrels. Normal logic would suggest that this should have thrown oil prices back towards the recent lows, but it didn’t.
I think there are two main reasons for this. The first being the continued strength in the equities market. The S&P continued to make new highs after Wednesday’s recovery and reversal of Monday’s big fall - even though the overall downtrend in equities is still intact.
The second reason is more mundane. There are frequently discrepancies, even opposites, between the Inventories data from API and the data released by the EIA usually on the following day. The EIA releases its version of the inventories data for the same week ending 21.12. later today and is still expected to show a draw. Therefore it is natural that the market would wait to see the EIA figures before reacting. In my opinion the EIA figures do carry greater credibility in the market.
In the absence of any other factors today I suspect we will see a quiet, meandering type of trading day today until the figures are released.
In the meantime, if we revisit the weekly chart, we can see how closely and widely this support zone, highlighted in some earlier posts, is being watched - if we look at the last three lows in 2016, 2017 and last Monday. All are within a few ticks of each other.
I interpret this as demonstrating that the oil industry itself sees this as the low area for it to still function normally and profitably, Prices below this start to destroy profits and repel investment money. If that is the case, then the only cause that would push prices down through this support zone would be widespread economic recession and a consequent slump in demand globally. I don’t think the other reason - excessive inventories build-up - is likely to become a real, prolonged problem because OPEC+Russia and others will be doing all that is necessary to keep a healthy balance in supplies and a stable price.
Weekly:
The daily chart gives a better perspective on this week’s moves. I think it is now quite clear that Monday’s collapse in both equities and oil prices was a freak event catalysed by events such as the US govt temporary shutdown and comments by the US treasury concerning the liquidity of the top US banks. A combination of existing downtrends, thin markets and negative factors pushed prices into a self-propelled decline.
Monday’s falls were quickly reversed on Wednesday. But, for oil, only back to the bottom end of last week’s range. If one ignores the daily bars for Monday and Wednesday, we are still paused at this same point reached last week. That is not very positive!
OPEC’s agreed production cuts do not start until the new year and will not come into effect immediately, rather the objectives will be achieved over the term of the agreement. But there are already comments confirming that OPEC will revue the situation as it starts to evolve and intervene if necessary.
I suspect the first “big news” in the New Year will come from new trade talks between US and China.
Daily:
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You will have to forgive my ignorance here @midwest because I haven’t personally ever used the CCI indicator nor have I traded DXY or any other dollar index.
However, I have vaguely understood that CCI is a momentum type indicator similar to RSI that compares current price with an average and indicates an overbought/oversold condition of the product it is applied to? In this case the DXY?
If so, why would it be indicating an inverse correlation? It appears to my inexperienced/naive eye (concerning these indicators) that the CCI is moving to its extremes as the DXY is reaching its strongest point in its trend (which seems to vaguely coincide with the tops/bottoms in this example) and then reverses as the price action starts to flatten out? As such, it seems that the extremes of the CCI at the +/-200 levels are not good indications of an immediate turn, rather they show when the momentum is slowing?
But maybe I have misunderstood one or both of these items, DXY and CCI! 
this is a weekly chart and I don’t think I could feel confident about using it based on these settings. It feels too loose and vague on a weekly basis to meet my trading horizons. What are your thoughts about it as a trading tool?
But I do not understand if this is meant to relate to your earlier topics of oil indices and currency crosses? Or is this something totally different?
I guess this chart is simply to apply the CCI indicator to the absolute value of the USD, as calculated using a basket of currency weightings, in order to gauge its trend strength and direction? There is no element of oil in this setup?
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my bad sorry for the confession, I was posting the DXY week chart to match your most recently posted Oil weekly chart.
By comparing the two charts we can see the DXY roughly inversely correlated to the Oil,
When I find the correct symbol on TVC I will be able to overlay them.
Oh in the case all the CCI is showing is the momentum dropping out of the DXY.
OK now I understand! Thanks, I’ll take another look.
Since the vast majority of oil deals are still priced in USD, even though the US is not one of the parties involved, one would indeed expect to find some kind of relationship between OIl price and the general strength/weakness of the USD.
Non-USDollar countries would tend to buy more when oil is cheap in their domestic currency and less when it is expensive and there should be some degree of correlation here. But it is only one factor in the trading of oil and therefore perhaps a somewhat loose relationship overall?
But I’ll comeback with some pics!
Thanks for raising the issue, it is an interesting and valid point!
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while many of the oil countries involved are not usd countries most must buy with usd however a few are trying to skirt the issue with corrupt-tos which is the purpose of cryptos i
In the meantime, it has been, not surprisingly, a relatively quiet day in WTI with no clear direction. I found nothing to trade until after the EIA release.
Since the inventories data was a smaller draw than anticipated, one could have again expected a drop if the market was negative. But it didn’t. In fact if started to do a little better.
I do like the kind of contrarian trade where the market fails to respond in the direction of the underlying trend in response to data that is sympathetic with that trend. It often results in a strong, unexpected bounce in the other direction.
So I went long after the number and set an optimistic target below the red dotted 1H 200SMAline in the chart below just in case we saw a sharp rally as part of end-year position adjusting. But no, we did see a quick bounce up to 50+ pips profit above the daily pivot level and I then lifted the stop to BE. But price just started to drift off quite quickly again so I closed it for a poor 16 pips profit. One cannot squeeze more from the market than it is capable of giving! 
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You are right there. Venezuela is currently attempting to introduce pricing in Cryptos.
The EU is also about to implement a mechanism for buying oil from Iran that is non-USD based and will circumvent the US sanctions if it works out.
China is also working on such schemes and probably Russia too!
Regarding the correlation between USDollar and WTI, here are two charts. The first is the weekly for several years with both USDollar index (red line) and WTI (blue line). There is a very wide inverse correlation visible (as you suggested) but it is extremely loose in price terms!
This is emphasised even more in the second graph which is a daily chart for this year. I don’t think I could find a way to use that for my trading purposes considering the scales of both commodities:
Weekly:
Daily:
What do you think of these?
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Yep, so far Russia tried with the blockchain, I’m not an international politico guy so I’m not going down this rabbit hole but I do not expect that the attempt to undermine the USD will decrease anytime soon but rather the opposite fostering the trade and commodity wars. Soon to come are the bond wars. Anyway off topic to say the least.
When I look at the charts you have posted I see much in the way of trading. BTW where did you produce the charts?
For example, I will use Currency Index - Mataf and compare the strength and weakness of currency almost daily and correlate that to an FX pair for trading. I think the same can be done with commodities. such as gold, silver which I follow but will add oil.
Wow! I am impressed! That is far more than my one brain cell could ever cope with 
I can only look at one chart and try to decide is it going to move up or move down - and that’s it! Pretty mundane really in the modern world!
I am glad to hear that. I wish you every success with it. The chart is just the WTI chart on my platform with my broker’s own USDollar index overlaid.
Manxx, I can’t do that with my broker, do you mind sharing which one you are utilizing?
If not no matter.
But thanks all for this thread, have a great and prosperous New Year.
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No secret. I use 2 brokers. This is FXCM’s marketscope platform - a brilliant and very user-friendly piece of work unless you want thousands of indicators like MT4/5.
And a very happy and successful New Year to you too and thanks for your contributions here!
Thx Manxx, can’t use FXCM as US person.