When Oil uncouples from the broad equity market - it's telling you something.
Is OIL SERIOUSLY undervalued right now??
- Thread starter orbit23
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i don't know what you are implying to be honest. Only thing i'm seeing is that SPX is stronger.
Monthly looks like a nice bull flag to me
Next weekly potentially big thin green candle -extension to the upside.The trade is working in my favor, i am not going to think, anticipate, or predict shit. Only trail stop loss. Below 54$ no go for me.
Yep. That's the ticket Maynard.
Generally speaking Crude Oil and the S&P 500 have been correlated since the late nineties - no mystery there. There have been two times in the past couple decades where Crude Oil seriously decoupled from the S&P 500 - in the middle of 2007 and in the middle of 2014.
And we are starting to see another decoupling. My point being - since American fracking and Canadian oil sands production has come to the world stage and inextricably altered the world supply dynamic - those decouplings have resulted in oil selling off.
In 2007, the decoupling began over constrained oil supplies and we had eight months of > $100 oil and oil didn't come off until we had the mortgage debacle and subsequent stock market meltdown. And it came off HARD - we went from $140 oil to $35 oil in 6 months and change.
Then fracking kicked in big time.
In 2014, the Saudi / OPEC war on American Fracking fizzled out and oil went from $105 to $45 in 6 months. We've been range bound ever since.
OPEC has lost it's mandate. Members like Venezuela, Nigeria, and Iraq are producing as much as they can and they are ignoring quotas.
Unless you see the Middle East erupt into total war - take your profits at $65. And if the S&P sells off like it did at the end of 2018 (or worse) you'll see the $30 - $40 handles again.
And we are starting to see another decoupling. My point being - since American fracking and Canadian oil sands production has come to the world stage and inextricably altered the world supply dynamic - those decouplings have resulted in oil selling off.
In 2007, the decoupling began over constrained oil supplies and we had eight months of > $100 oil and oil didn't come off until we had the mortgage debacle and subsequent stock market meltdown. And it came off HARD - we went from $140 oil to $35 oil in 6 months and change.
Then fracking kicked in big time.
In 2014, the Saudi / OPEC war on American Fracking fizzled out and oil went from $105 to $45 in 6 months. We've been range bound ever since.
OPEC has lost it's mandate. Members like Venezuela, Nigeria, and Iraq are producing as much as they can and they are ignoring quotas.
Unless you see the Middle East erupt into total war - take your profits at $65. And if the S&P sells off like it did at the end of 2018 (or worse) you'll see the $30 - $40 handles again.
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@bone Look at the prices. Isn't this disgusting? Talk about ranging.
Oi!
https://www.elitetrader.com/et/threads/and-they-have-a-plan-live.306838/
Goldman Sachs is backing off it's $62 year end target, and PVM is telling it's commercial clients to hedge at current levels because Gulf production is up 30 percent and US production continues to set new records. OPEC production rose 690K bpd in October.
It's tough to rally on a ridiculous supply level in the Commodity World.
It's tough to rally on a ridiculous supply level in the Commodity World.
Yep, rangebound since 2015 and the world continues to set production records. Stock market rallies and sets new records; oil rangebound. Commodity pricing is all about supply and demand.