Recently the commodities and the commodity stocks are having a bull run. Oil being one of the largest categories within the Bloomberg Commodity Index Futures is late to the party after the 
GLD rally. In my recent posts I made the case that the 
USOIL will remain range bound, and we will see 55 $ in $USOIL. But since then, USOIL has gone through a small rally with price currently @ 65 $ which has taken it closer to the 0.5 Fib retracement level. 
XLE, which represents the S&P500 energy sector stocks, is also attempting to post a rally.
In the short-term markets have diverged from our last predictions. Let’s be honest in the short term such rallies might be accompanied by short covering and the weakness in
DXY is also helping the Energy rally. But now the question comes where do we go from here?
USOIL and XLE can have a bull rally due to short covering and momentum pushing it across the 0.5 Fib level. If USOIL breaks above 0.5 then the next stop 0.618 will take us 80 $ indicating a 25% upside form here. And a similar upside in the XLE will take us 131 $, which is also 25% up from its current value and the upper range of the upward slopping channel indicative from the chart.
Verdict: Short term probable bounce inUSOIL and $XLE. Long term bearish on USOIL with target 55 - 60 $.
GLD rally. In my recent posts I made the case that the USOIL will remain range bound, and we will see 55 $ in $USOIL. But since then, USOIL has gone through a small rally with price currently @ 65 $ which has taken it closer to the 0.5 Fib retracement level. XLE, which represents the S&P500 energy sector stocks, is also attempting to post a rally.In the short-term markets have diverged from our last predictions. Let’s be honest in the short term such rallies might be accompanied by short covering and the weakness in
DXY is also helping the Energy rally. But now the question comes where do we go from here?USOIL and XLE can have a bull rally due to short covering and momentum pushing it across the 0.5 Fib level. If USOIL breaks above 0.5 then the next stop 0.618 will take us 80 $ indicating a 25% upside form here. And a similar upside in the XLE will take us 131 $, which is also 25% up from its current value and the upper range of the upward slopping channel indicative from the chart. Verdict: Short term probable bounce in
USOIL and $XLE. Long term bearish on USOIL with target 55 - 60 $. 
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.