Short oil Multiple weakness seen here, with every rally being sold off.
The support at 46.5 should break any time right now, great opportunity to short here with 1% stop loss.
Opec
Fund. will channel/squeeze until OPEC. Watching inv/rig countTA memo to myself charting possible contingencies.
USOIL to follow fundamentals/EIA/API/Rigs and channel/squeeze until September OPEC meeting.
Currently at 46.60ish. EIA report was bearish but less bearish than the API report. I am still tempted for potential break-out buy point is at 46.00ish? But another more realistic possibility for me--if last week was just a sign of major short squeeze and we are now at a neutral zone, then we may go back towards the another major short after a failed OPEC meeting. But, because of looming OPEC meeting and rumors of a supposed cap, we may have a little tug of war between the bulls and bears resulting in a channel.
Fundamentals point to bearish: As of today, EIA, API, Baker Hughes are bearish.
Technicals: The pullback is week compared to the jump; but again, the last few week jumps have been supposedly a major short covering and this pull back is likely a neutral pullback.
Conclusion: sideways movement again until the OPEC meeting as news goes back and forth.
Prediction: The week of the OPEC meeting, possible sell-off because OPEC will probably not fall through again.
Like the OPEC move, yes lets move it.Too many HS patterns, I just randomly pick one. The timing is not well considered, take the general guideline only please. Wait for the head, head might be in already.
Sell Oil on break from trend line Cl1!
"Oil Minister Al-Falih has said “We are, in Saudi Arabia, watching the market closely, and if there is a need to take any action to help the market rebalance, then we would, of course in cooperation with OPEC and major non-OPEC exporters.” This is the same talking point the kingdom has been using for some time. It neither acknowledges the need for action, nor firmly commits Saudi Arabia to participate if certain parameters are met.
COMMODITIES - GOLD & OIL: GS WHAT'S DRIVING THE MARKET TODAYGOLDMAN SACHS - COMMODITIES: WHAT'S DRIVING THE MARKET TODAY
The One-Liner
Commodities broadly higher with weaker USD. Copper trading higher after failing to break $4750 in recent days.
The Fundamental Highlights
Energy: Crude marginally higher with spreads and cracks largely unchanged. The Iranian Oil Minister has not yet decided whether he will attend the Algeria IEF15 meeting at the end of Sept, with the country not expecting to hit their pre-sanction production before the meeting (their longstanding condition of joining a production freeze). Elsewhere, Nigeria has said that it sees OPEC cuts as unlikely.
Industrial Metals: Base metals trading broader higher over the session, with Nickel (-1.5%) the significant outlier with Philippines expecting to complete environmental audit this month. Copper is trading well with Antofagasta CEO Ivan Arriagada saying the company is focused on profit rather than maximizing production and that output will be at the lower end of its 710,00- to 740,000 mt target. Copper vols are unchanged on the session, although were once again marked lower into the close yesterday with Sep ATM vol now 18v (-0.5v) vs realized at 15.8v.
Bulks: Ferrous metals have rallied however with Iron Ore +3.8%, Rebar +4%, Coking Coal +6% as a reiteration by the NDRC that they are less than half way through their steel and coal capacity cuts, and an announcement that they are planning a new 3-year infra stimulus programme for the northeast. China has promised 45mt of steel capacity cuts and 250mt of coal capacity cuts this year, but so far has only reached 47% and 38% of each target respectively.
Precious Metals: Gold stronger over the London morning (+1%), moving in tandem with the weaker USD. Gold ATM vols are largely unchanged this morning, although worth noting that Gold 1m realized vol fell to 12m lows yesterday. Participation feels light of late with aggregate OI 15% off the post Brexit highs. The ETF added 220k oz as of Fridayâs data point, which doesnât explain the $20 sell off into the close on Friday.
USOIL/ UKOIL: IEA MONTHLY OIL MARKET REVIEW WTI & BRENTIEA Monthly Oil Market Review:
-IEA Keeps World Oil Demand Growth Forecast at 1.4M B/D in 2016
-IEA Downgrades World Oil Demand Growth to 1.2M B/D in 2017
-IEA Sees Lower Oil Demand Growth on Dimmer Macroeconomic Outlook
-IEA Sees Lower Oil Demand Growth on Dimmer Macroeconomic Outlook
-IEA Says Global Oil Supply Up 800,000 B/D in July on Higher OPEC, Non-OPEC Output
-Non-OPEC Output Seen Falling by 900,000 B/D in 2016--IEA
-Non-OPEC Output Will See Growth of 300,000 B/D in 2017--IEA
-OPEC July Output Rose 150,000 B/D to 8-Year High of 33.39M B/D on Saudi, Iraq--IEA
-Saudi July Output Hit Record 10.62M B/D, Up 120,000 B/D From June-IEA
-IEA Says Kuwait and the UAE Pumped at Their Highest Ever Levels
-IEA: Non-OPEC Supplies Output Rose by 550,000 B/D in July, to 56.7M B/D
-IEA Says Expects More Subdued Growth in Refining Activity
-IEA Says Crude Oil Balance Indicates Hefty Draw in Third Quarter
-IEA Says Massive Stock Overhang Keeping Lid On Prices
-IEA Says OECD Commercial Stocks Stood at 3.093B Barrels by End-June
Crude oil (WTI) Short to Medium Term Analysis
The WTI Crude touched a Low of $40.55 last week after the release of inventory data (Last Wednesday) showing over Supply.
The recent release of Chinese PMI data showing signs of Chinese economy slowing down further, which puts additional pressure on Oil going forward.
Read More Here :
Buyers Buy $41.10-$41.30 for targets of $44-$45 and a Stop below $40.40.
Sellers Wait for the Bounce to complete and Short around $46 levels and stops around $48 targeting $35.
I hope i have not disappointed anyone because i have something for everyone ;) But i am more biased towards the short side.
Happy Trading People
Cheers!!
FX:USOIL
USOIL UKOIL: IEA MONTHLY OIL REPORT - BREXIT; DEMAND > SUPPLY 17The IEA Oil Market Report was largely in line with OPEC's assesment yesterday - Non OPEC output was seen falling in 2016 by 900,000 B/D - However, they differed on the 2017 perspective with 2017 expectations from the IEA forecasting a modest growth of 200,000 B/D in 2017. Opec Output however rose to an eight year high up 400,000 B/D in June at 3.21M B/D on the back of Saudia and Nigerian growth.
On the margin the IEA actually came out on the margin relatively bearish for the oil market and its future - citing a global oil supply increase at +600,000 B/D to 96m in June - with Non OPEC seen at 55.9m B/D.
Nonetheless, the IEA went out of their way to highlight that the oil market had made an extraordinary recovery from "Market Surplus" to "near balance" in Q2 2016. The IEA Uped the World Oil Demand Growth Forecast to 1.4M B/D in 2016 (up +0.1M B/D), whilst seeing World Oil Demand Growing by 1.3M B/D in 2017. On the margin it is unsure what the net forces are for 2016 and 2017's demand-supply balance will be, though a 1.4m B/D in 2016 increase in global oil demand growth outstrips the Non-opec 200,000 B/D increase in supply foretasted - this is medium term bullish for Oil . They remained on the fence with Brexit concerns which imo is a positive positioning for the oil market given there should be a negative bias
Other notable statements were "There is still an ominous investment gap building up in the oil industry that might, depending on how quickly today's record high oil stocks are eroded, create the conditions for sharply higher prices over the medium term." and "Our underlying message that the market is heading to balance remains on track, but the modest fall back in oil prices in recent days to closer to $45/bbl is a reminder that the road ahead is far from smooth." - these comments in mind, traders should use this information to understand that volatility is likely to be higher so TP/SL should be adjusted accordingly to reduce the margin of error. Personally, i think further USD strength may continue to dull the oil market.
IEA Monthly Oil Report Analysis:
-IEA: Global Oil Supply Rose 600,000 B/D to 96M B/D in June
-IEA: Non-OPEC Output Seen Falling by 900,000 B/D in 2016
-IEA: Non-OPEC Output Will See Modest Growth of 200,000 B/D in 2017
-IEA: Non-OPEC Output Rose in June by 205,000 B/D to 55.9M B/D on Partial Recovery in Canada
-IEA: OPEC June Output Up 400,000 B/D to Eight-Year High of 33.21M B/D on Rise in Saudi, Nigeria
-IEA: Says Saudi Arabia Ramped Up Output to Near-Record Rate of 10.45M B/D in June
-IEA: Says Iranian Output Rose to 3.66M B/D in June, up 50,000 B/D From May
-IEA: Says OECD Commercial Stocks Stood at Record 3,074 Million Barrels by End-May
-IEA: Market Showing Extraordinary Transformation From Major Surplus to Near Balance in 2Q
-IEA: Says High Oil stocks Are Threat to Recent Stability of Prices
-IEA: Ups World Oil Demand Growth Forecast to 1.4M B/D in 2016
-IEA: Sees World Oil Demand Growing by 1.3M B/D in 2017
-IEA: Says Middle East Oil Output Rose to Record High of 31.5M B/D in June
-IEA: Says Hard to Draw Conclusions About Brexit
-IEA: Says High Oil Stocks Pose Threat to Price Stability
www.iea.org
Oil: rising wedge providing possible movementsThis rising wedge indicates a number of possibilities for the next movement in brent oil.
Could be a trigger for a bearish move down, or provide further momentum up to the mid $50s.
I think that given the views of the new Saudi oil minister al-Falih and the possible beginnings of a market rebalance following Saudi Arabia successfully pushing a chunk of the US out of the market (see Goldman Sachs), plus a wave of petrol demand in India, this will trigger the next move up towards $56 per barrel.
Oil is getting toppyMight make a spike towards $50, but regardless this is a good place to start shorting or to buy out-of-the-money puts for August 2016 at around 45-47.
I'm not too bothered about not having a stop loss on my DWTI and CL options here...
Oil isn't going anywhere..
Net long position near record highs
Weakening Chinese demand
Short squeeze is done
Frackers aren't dead yet, the battle for marketshare between Saudi, US, and Russia continues.
Is Dennis Gartman finally bullish of oil? LOL
Most importantly, mainstream media collectively are now bullish of oil despite the fact that fundamentals have not changed. The only thing that's changed is the sentiment of the market participants
oilprice.com
www.bloomberg.com
As #OPEC Meets, #Crude May Feel DisappointedTomorrow, members of OPEC will meet in Vienna, and it is unlikely there will be any policy shifts. Despite the dire straits some OPEC members are in, such as Venezuela, the current crude production policy will likely remain until Iran and Russia agree to some sort of production resolution.
MacroView has been overly bearish since June 2014 but indicating that the one key dynamic factor in crude prices would be supply (same goes for Brent and OPEC). Essentially, West Texas Intermediate would continue to see woes until there were meaningful cutbacks in crude production, which finally began to filter through on a combination of record-low rig counts and bankruptcies (yes, bankruptcies are bullish). Crude output levels in the U.S. are at levels last seen during the second-half of 2014.
West Texas Intermediate has been trading within the current supply range between $48/50 for the last 12 trading sessions, and price action is currently treating the current trend support on narrowing price action. If OPEC disappoints tomorrow, and break through trend would cause traders to seek out support near $42, while a confirmed breakout of the supply zone could trigger buying to $55.
The weekly chart picture for crude:
OPEC's production has largely offset declines seen by U.S. shale producers, and members will continue to press on. Iran has said they look to achieve 2.2 Mbbl/day to compete with Saudi for market share; Iraq and Kuwait both look to increase their production meaningfully. Non-OPEC member Russia continues to keep oil production at post-Soviet highs.
Side note: expect volatility in commodities currencies on headline risk. The Canadian dollar has pulled back after gaining 18 percent on crude's rally, but it remains vulnerable.
For more information on MacroView's products, or general questions and comments, feel free to message us.
Also, readers are encouraged to post their thoughts and charts!
Crude Oil Complex Analysis1. line stop date : 13.05.2016 Level: 38.60
2. line stop date : 24..06.2016 Level: 41.32 ***
3. line stop date : 19.08.2016 Level: 33.14
***Second Opec Meeting is very important for second line stop date
USDCAD - Waiting for OPEC ResultsWe doubt the members and non-members will ever make a freeze deal "willingly"...subject to Doha results. Play accordingly. GL.
~ We are leaning towards long to 1.32s ~
WTI OIL ShortOil has been trending up but this seems like a time when the tide turns for the short term.
The double top is obvious enough and 38.2 retracement at 36 is strong short term target for shorts.
The next targets are 32 and 27.
The OPEC and Non-OPEC meeting coming Sunday has been a major driver of this rally along with (possibly more) the weakness in commodities in general. Despite tapering down of expectations from Saudi and Russia, never mind Iran, oil has remained firm. The announcement coming out from the meeting is most likely to disappoint investors and also aid buy the rumor sell the news philosophy. This is not looking good for oil and a visit to the lows of 26 is not out of question.
USOIL bearish divergence on H1 but maybe another drive up firstUSOIL bearish divergence on H1 but maybe another drive up first
on the hopes of a solution in the Doha meeting, USOIL might take another drive up, signalised by the stochastics in oversold territory, then wake up to reality and turn back down, probably towards 38US$ region, where it will meet its strong uptrendline.
I am not trading this idea yet.
twitter.com
WTI will reach the 44.00-46.00 area by the end of 2016The fundamentals are still bearish at the moment, thanks to global oversupply. The weakness in WTI is caused by the moderately declining U.S. production, increase in the output of OPEC and the return of Iran to the world stage, as sanctions were lifted. The fears of further oil decline are further overlined by the decision of Saudi Arabia and Kuwait to restart global produce up to 300 thousand barrels a day.
On the other hand, the talk of oil freeze increased oil prices by more than 10% in March. Which led big hedge funds to start betting on higher oil prices.
My expectations are that prices will continue falling and that by the end of 2016, prices will reach the 44.00- 46.00 area.
This perspective will change depending on the fundamentals, but with the current data given this is my opinion.
All Publications are published for informative purposes only and are in no way to be considered as investment advice or recommendation. Any investment decision based on the Articles of the author is made by the audience, and Autor is not responsible for any loss or damage arising from such decision, whether based or not based on the Publications of the Autor.
August 2015 lows as resistance to USOIL at 39US$ +divergenceAugust 2015 lows as resistance to USOIL at 39US$
As we all know USOIL mainly reacts to markets' moves, so we will have to see how markets pick up the
doom & gloom news from the ECB on monday/tuesday.
Technically it clearly is a short, with growing bearish divergence in the H4 between RSI and the curve.
Decline is possible down to 34US$ (0.382 Fib support + round number) in the coming week.
Thanks for your attention.
Always make sure you only use this as an inspiration to make your own analysis and plan your own trade carefully.
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USOIL - Long outlookThis has been on a relentless selloff for nearly 2 years, oversupply is currently in place, but if that changes with OPEC etc then demand may return (albeit temporarily), to start up a mini bull market for oil but we doubt it will go much higher that $45.00 in the near future and in fact maybe lower lows.
The Dimon Bottom Hype Is OverCNBC has loved to refer the recent pullback in the SPX as the "Dimon Bottom" because CEO Jamie Dimon purchased roughly $26 million worth of JPM shares. However, it's not looking for those wanting to hold to believe in the recovery dream.
Whether investors want to believe it or not, the U.S. economic cycle is rolling over; and, considering the very high correlation to the SPX, J.P. Morgan shares will unlikely be saved.
Since 2014, I been warning of potential headwinds from energy exposure in U.S. banks. It may not cripple the sixth-largest bank in the world, but death by 1,000 cuts won't be any better for shareholders.
On Tuesday, JPM reported a 20 percent decline in trading revenues, as well as a $500 million increase in provisions (up 60 percent) due to their energy exposure. Fee revenues were down 25 percent.
Technically, the weekly chart is showing more downside is to come. Traders are watching a 20-weekly bearish convergence with the 50- and 72-weekly EMA. Price action is, also, currently below the 200-weekly EMA.
The inability to show support above this level and challenge $59.60 could poise further stress on shares.
Near-term, we'll see price action test the trend/price demand between $52.30-$53.50. A close below $52.30 would open up $48.3 and trend lower to $43.74.
If looking at Fib. retracements, a close underneath Aug 24, 2015 Black Monday low, 1.618 Fib. extension would stand at $37.54. This would be my target for Q2-17.
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Brent Near-Term OutlookBrent crude has been able to rally on little volume during the U.S. banking holiday and rumors surrounding a potential unified OPEC production cut, issued by the UAE energy minister just as WTI was carving out a 12 year low (and in the middle of the night, local time, no less.)
Four days later, there has been no new reports of said production cut proposal, but something interesting has been reported by Charles Kennedy at Oilprice.com - " UAE Offers India Free Oil To Ease Storage Woes ."
There is still no reason why OPEC would cut production now given the distress its tactics are already causing in the U.S. shale space. To cave in now, OPEC's squeeze on U.S. shale would be a failure and U.S. shale would be a beneficiary.
The same UAE that sparked the latest crude short-squeeze has so much oil, it's bribing India with free oil in order to access a underground Indian storage facility to park abundant reserves. Go figure.
Despite OPEC's true unwillingness to cut production, the technical outlook for Brent could prove positive unless risk sentiment is turned off.
Currently testing price resistance at $33.81, Brent crude has found support at two key weekly support levels: $27.83 and $31.59. The ADX is showing a lack of momentum in the current move, but +/- DMI could, potentially, have a bullish convergence.
The growing tensions between Saudi, Turkey and Syria could reignite risk premium, but many analysts have suggest that any substantial premium is unlikely due to the current supply glut. Even so, resistance at the 50-day EMA coincides with a minor downtrend.
However, a break north could test $38.46 to $40.34. If price breaks down, Brent could easily retest $27.83, while more talk of not cutting production would send the international benchmark to $22.98.
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Crude Technical OutlookCrude started the new year with volatility, as prices initially rebounded into price resistance near $38/bbl on geopolitical tensions between Iran and Saudi Arabia. However, the rally was short-lived and there looks to be no follow through in today's session.
There are a few key factors to take into account: slow global growth, a decline in global demand growth and a supported dollar.
As posted here and here , near-term resistance is near $38/bbl which has been tested and failed twice in the last two days. Technical breadth still remains negative, and the lower have of the demand zone is the next area of support between $33-34/bbl.
If the bottom of the range breaks, $27 is open for the taking. As mentioned in August :
"On a market technician's viewpoint, if fundamentals do not shape up quick with support from consumption economies, like the U.S. and China, crude could break 2009's low of $33.20 per barrel.
I also expect the dollar to continue to rise, increasing deflationary pressure throughout 2016.
Price support is currently $42.02, just $2.22 per barrel less from where it is trading today. 2008's high of $147.27 per barrel creates a "V" shaped support and resistance price channel, which will likely hold prices.
If prices break through this key support level, selling could amplify if there is no catalyst to bring prices back north. A "demand" zone - an area where confirmed buying took place - between $38.34 and $34.04 will be the last line of defense for crude prices.
A close below this level, and a target of $27.14 per barrel is initiated."
Take it back further to last February :
"A bottom in crude will be formed when a series of indicators and data show confluence."
"Growth has been lacking, and it is concerning that China – the largest consumer of oil – is showing real signs of trouble. GDP recently hit two decade lows, and the most recent import/export data is troubling. China saw a 3.3 percent decline in exports and a whopping 19.9 percent decline in imports YoY, the worst since 2009. It was was 16 percent lower than the general consensus.
There is also disinflation. Whether it is in the US, Eurozone, or China, prices for commodities will remain low. Crude is no exception.
A bottom in crude will not likely begin until fundamentals mingle with price action. Inventory builds of 5, 6, 10 million barrels per week will not help the case for higher prices, and oil companies could be forced to further slash rigs, jobs and CAPEX.
And considering the deteriorating economic data, more so in the US, 2008’s low could be retested."
If bulls could retake momentum, upside potential could reside at $42.75 and, potentially, $48.55. The situation remains dynamic as an unexpected production cut from a large producer could spark huge short-covering (unlikely to change long-term sentiment). Although, OPEC and Russia look to remain active, while production in the US is still near historical highs .
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