Crude Oil and oil markets

[adam3383]

Nice, years end reflections. I have also wrote mine on my blog:
https://tradingusoil.blogspot.com

The last four days of 2018 were price action uneventful. The experience is now that the market is just issing liquidity, its better to stay off it. Now is waiting for market to come alive tomorrow. I have one long position after the pinbar reversal from the psychological support of $41.
My expectations are, if the market stays bearish that the price goes back to $50 and rotate down beyond $40. If the markets gets bullish, the price will go beyond $50.
The get the market sentimnt bullish few things needs to happend on the global scale. First, the US-China trade war must come to a kind of truce or end so that trust in the economicl growth comes back. Second, OPEC responsible for 30 percent crude oil market share must conclude production cut. There is no third option because US will not cut its production, but it would help if its inventories and refinery operations data production of the four major petroleum products: motor gasoline, kerosene jet fuel, distillate (by sulfur content), and residual fuel oil would shrink.

[anon46773462]

Thanks @adam3383 for your interest here!

The big difference between the US oil industry and that of Russia and Saudi Arabia is that the companies in the US decide their production and not the government direct. How prolonged low prices affect production decisions in the US is very different to those in OPEC+ nations and it remains to be seen how things unfold here…that is, if the stock markets have not resolved the price issue to the upside in the meantime!

[anon46773462]

Both WTI and S&P are still in negative mode on the daily-1H charts, and both currently trading below last Friday’s close, but with no significant post-holidays direction yet. Seems they are currently just chasing each other’s shadows with a slight downward bias based on more negative economic data from China.

I can’t sell either of these here, yet, and think this is a “sit on hands” job and wait out until the next signal comes along…it’s too soon out of the holidays to form a trading decision yet…

…but if we do go lower then it does mean a better entry level for when we eventually do turn bullish again.

[anon46773462]

@anon46773462

I can’t sell either of these here, yet, and think this is a “sit on hands” job and wait out until the next signal comes along…

Wasn’t a very long wait!!! … First trade of the year - and it was a buy!

[anon46773462]

And trade No…2:

Decided to take a long on S&P as well as it seemed to be lagging Oil…and it soon caught up.

Over 200 pips - a good first day.

[midwest]

Good on you!

[anon46773462]

Thanks @midwest

Both OIl and S&P are looking quite perky today on the short term charts…but the dailys are still a bit overcast, so I’m a bit nervous about getting too enthusiastic here on the upside. I going to sit this out now and see how the day ends up before deciding further moves…

[midwest]

USDCAD did NY well at the open but now not so much and running opposite the DXY currently.

[anon76360754]

Looking good Manxx - i’m still sat in my short and added into the position at 47.0

[peterma]

@peterma

When you look at this last chart there is a sense that risk might continue to be on (tweets aside) in the early days of new year.

Today is the first day, no risk off tweets since that post so pretty much as expected.

WTI is leading - also XLE leading in the S&P etf’s - only one company didn’t register a gain today - Baker Hughes.

When you think about it that’s not such a surprise if the longer term outlook is lower prices.

(Image courtesy of sectorspdr.com)

Btw, just saw a headline “Risk sentiment remains sour ahead of US trading”. That guy was reading prices before the US opened - current market sentiment revolves around US risk, not EU, that’s why the analyst got it wrong:

Chart is German 10yr Bund today: (buy the bond in risk off)

See that huge push up early today - that was EU trading time, then check the US10yr for today.

Most recent tweets are risk conciliatory - the Pres referred to last weeks moves as a “glitch”.

[anon76360754]

targeting 44.50 now for both TPs - a slight adjustment given what’s happened over the past week. Seem’s realistic, although 46.50 seems a potential level of support kicking in (the high of 31/12)

I guess a chart would help…

[anon46773462]

@BaconSandwich

i’m still sat in my short and added into the position at 47.0

@BaconSandwich

targeting 44.50 now for both TPs - a slight adjustment given what’s happened over the past week. Seem’s realistic, although 46.50 seems a potential level of support kicking in (the high of 31/12)

My Daily chart still looks vulnerable on the downside. We seem to be struggling up at these recent highs:

On my hourly, which is neutral right now, I would be looking at three TA targets below here:

the 1H 200 SMA (touched earlier)

the daily pivot from Mon

the Close from last Friday

We don’t really have a clear underlying trend right now so this is getting a bit tricky…

[anon76360754]

We don’t really have a clear underlying trend right now so this is getting a bit tricky…

Even more of a reason to have a party - gotta love a tricky market. Oh well… it’s been a bit of a funny position really, I had all intention to ‘add in’ at a higher price, which i’ve done to net off the losing position. Could this all end in tears, yes, but it could also give a nice pay off if I can ride it out

Edit: In a standard FX trade of this nature i’d have been well out for a loss - but I still like the look of the bigger picture here, which is bearish. I feel i’ll be tested here to hold.

[midwest]

USDCAD, but mostely EURUSD and XAUUSD, USDCAD “V” you see on the chart, I missed, unfortunately, this chart is in CST also on the chart is the DXY compare at the bottom you can see the kick off correlation at 2 am CST then at 7 am VST NY open the reversal!

Note the most recent double top and double bottom on the USDCAD

Small account is easy to have a decent daily return…

[anon46773462]

@BaconSandwich

tricky…

Even more of a reason to have a party

Hmmm, but maybe not today. We had a violent blizzard here last night, all night, and I just spent all day shifting 20-50cms of snow out of the driveway. I just got it finished when the town’s snowplough turned up and … :

[midwest]

Manxx, bummer, IA has been spared so far this year.

[anon46773462]

Small account is easy to have a decent daily return…

Wellv done! Looks like a promising start all round!

[midwest]

Yep you both also, really great when you can find a trend in these choppy days.

an associate made just over 7% of his account this morning on the USDCAD slide down.

[anon76360754]

We’re getting there - slowly but surly

[anon46773462]

Yes, so far it has reached two of my levels and did seem to like the 1-Hour 200SMA level (we have been seeing some tails under this line this morning in Asia on the 1-hour chart below - but that is not anything major - just maybe some short term speculative buying - but could also indicate some support around here). The next step on my charts would now be last week’s Friday close, that on my charts was at 45.04.

In my attempt to have the prettiest charts on BP ( ) I have now added for fun a Guppy-type MMA to emphasise the short term end of my charts. Warning: sunglasses are recommended

Here’s the 1H chart, with this addition, which is just about still hanging on to a neutral position by its fingernails, but it still heavily overshadowed by that Daily grey overlay…

On the news front, we are now into January when the OPEC+ production cuts officially start and all ears will be turned towards news from that direction.

But, interestingly, yesterday’s rally in oil was prompted by news that Saudi Arabia’s exports had already dropped significantly in December - and most of the decline being in exports to China and the US. The UAE also reduced exports in December and expressed the view yesterday that the market should be in balance again in Q1 2019.

Why this is interesting, is because the rally was short and sweet and didn’t even manage to remain above last week’s range. When things don’t go up that “should” go up, it often indicates that the core view is in the other direction…

But a timely reminder here: this week’s US inventories data is released today (API) and tomorrow (EIA) (as well as the BH rig count tomorrow). Whilst these only analyse the US stock levels (and the US is not an exporter of crude, yet) they are the most widely watched inventories data and will move the market if the data deviate from the analysts’ opinions. It is also a tease that the API data also often differs from the EIA data.

Yesterday was clearly a day-trading environment for both crude oil and S&P and I still don’t see any reason for setting longer term positions in either market. So, for me, today will be another day for grabbing any short-term opportunities, if such should present themselves…

Cushing oil hub, Oklahoma