A New President's Potential Impact on Oil Prices1. Introduction
The U.S. presidential election in 2024 is set to bring new leadership, with a new president guaranteed to take office. As history has shown, political transitions often have a profound effect on financial markets, and crude oil is no exception. Traders, investors and hedgers are now asking the critical question: how will WTI Crude Oil futures react to this change in leadership?
While there is much speculation about how a Democrat versus a Republican might shape oil policy, data-driven insights provide a more concrete outlook. Using a machine learning model based on key U.S. economic indicators, we’ve identified potential movements in crude oil prices, spanning short, medium, and long-term timeframes.
2. Key Machine Learning Predictions for Crude Oil Prices
Short-Term (1 Week to 1 Month):
Based on the machine learning model, the immediate market reaction within the first week following the election is expected to be minimal, with predicted price changes below 2% for both a Republican and Democratic win. The one-month outlook also suggests additional opportunity.
Medium-Term (1 Quarter to 1 Year):
The model shows a significant divergence in crude oil prices over the medium term, with a potential sharp upward movement one year after the election. Regardless of which party claims the presidency, WTI crude oil prices could potentially rise by over 40%. This is in line with historical trends where significant price shifts occurred one year post-election, driven by economic recovery, fiscal policies, and broader market sentiment.
Long-Term (4 Years):
Over the course of the full four-year presidential term, the model predicts more moderate growth, averaging around 15%. The data suggests that, while short-term market movements may seem reactive, the long-term outlook is more balanced and less influenced by the winning party. Instead, economic conditions, such as interest rates and industrial activity, will have a more sustained impact on crude oil prices.
3. Feature Importance: The Drivers Behind Crude Oil Price Movements
The machine learning model's analysis highlights that crude oil price movements, especially one year after the election, are primarily driven by economic indicators, rather than the political party in power. Below are the top features influencing crude oil prices:
Top Economic Indicators Influencing Crude Oil:
Fed Funds Rate: The most significant driver of crude oil prices, as interest rate policies affect everything from borrowing costs to overall economic growth. Changes in the Fed Funds Rate can signal shifts in economic activity that directly impact oil demand apart from the US Dollar itself.
Labor Force Participation Rate: A critical indicator of economic health, a higher participation rate suggests a stronger labor market, which supports increased industrial activity and energy consumption, including crude oil.
Producer Price Index (PPI): The PPI reflects inflation at the producer level, impacting the cost of goods and services, including oil-related industries.
Consumer Sentiment Index: A measure of the general public's outlook on the economy, which indirectly influences energy demand as consumer confidence affects spending patterns.
Unit Labor Costs: An increase in labor costs can signal inflationary pressures, which could lead to changes in oil prices as businesses pass on higher costs to consumers.
This study exclusively uses U.S. economic data, excluding oil-related fundamentals such as OPEC+ supply and demand information, in order to focus on the election’s direct impact through domestic economic channels.
Minimal Influence of Political Party on Price Movements:
Interestingly, the machine learning model suggests that the political party of the newly elected president has a relatively low impact on crude oil prices. The performance of WTI crude oil appears to be more closely tied to macroeconomic factors, such as employment data and inflation, than the specific party in power.
These findings emphasize the importance of focusing on economic fundamentals when analyzing crude oil price movements for longer term exposures, rather than solely relying on political outcomes.
4. Historical Analysis of Crude Oil Price Reactions to U.S. Elections
Looking back over the last two decades, the performance of crude oil post-election has varied, depending on global conditions and the economic policies of the newly elected president.
Notable Historical Movements:
George W. Bush (Republican): In his 2000 election, crude oil dropped nearly 50% within a year, reflecting the broader economic fallout from the bursting of the dot-com bubble and the events of 9/11. In contrast, his 2004 re-election saw oil prices climb 21.5% within a year, driven by the Iraq War and increasing global demand for energy.
Barack Obama (Democratic): After his 2008 election, crude oil prices surged by 33.8% within one year, partly due to economic recovery efforts following the global financial crisis. His 2012 re-election saw more modest growth, with an 8.3% rise over the same period.
Donald Trump (Republican): His election in 2016 coincided with a moderate 23.8% increase in crude oil prices over one year, as the U.S. ramped up energy production through fracking, contributing to global supply increases.
Joe Biden (Democratic): Most recently, crude oil prices skyrocketed by over 100% in the year following Biden’s 2020 victory, driven by post-pandemic economic recovery and supply chain disruptions that affected global energy markets.
5. WTI Crude Oil Contracts: CL and MCL Explained
When trading crude oil futures, the two most popular contracts offered by the CME Group are WTI Crude Oil Futures (CL) and Micro WTI Crude Oil Futures (MCL). Both contracts offer traders a way to speculate or hedge on the price movements of crude oil, but they differ in size, margin requirements, and ideal use cases.
WTI Crude Oil Futures (CL):
Price Fluctuations: The contract moves in increments of $0.01 per barrel, meaning a $10 change for one contract.
Margin Requirements: As of recent estimates, the margin requirement for trading a CL contract is around $6,000, though this can fluctuate depending on market volatility.
Micro WTI Crude Oil Futures (MCL):
Price Fluctuations: 10 times less. The contract moves in increments of $0.01 per barrel, meaning a $1 change for one contract.
Margin Requirements: 10 times less, around $600 per contract.
Practical Application:
During periods of heightened market volatility—such as the lead-up to and aftermath of a U.S. presidential election—traders can use both CL and MCL contracts to navigate expected price fluctuations. Larger traders might use CL to hedge against or capitalize on significant price movements, while retail traders may prefer MCL for smaller, controlled exposure.
6. Conclusion
As the 2024 U.S. presidential election approaches, crude oil traders are watching closely for market signals. While political outcomes can cause short-term volatility, the machine learning model’s predictions emphasize that broader economic factors will drive crude oil prices more significantly over the medium and long term.
Whether a Democrat or Republican wins, crude oil prices are expected to see a potential increase, particularly one year after the election. This surge, driven by factors such as interest rates, labor market health, and inflation, suggests that traders should focus on these economic indicators rather than placing too much weight on which party claims the presidency.
7. Risk Management Reminder
Navigating market volatility, especially during a presidential election period, requires careful risk management. Crude oil traders, whether trading standard WTI Crude Oil futures (CL) or Micro WTI Crude Oil futures (MCL), should be mindful of the following strategies to mitigate potential risks:
Use of Stop-Loss Orders:
Setting predefined exit points, traders can avoid significant drawdowns if the market moves against their position.
Leverage and Margin Control:
Overexposure can lead to margin calls and forced liquidation of positions in volatile markets.
Position Sizing:
Adjusting position sizes according to risk tolerance is vital especially during uncertain periods like elections.
Hedging Strategies:
Traders might consider hedging their crude oil positions with other instruments, such as options or spreads, to protect against unexpected market moves.
Monitoring Economic Indicators:
Keeping a close watch on key U.S. economic data can provide valuable clues to future crude oil futures price movements.
By using these risk management tools effectively, traders can better navigate the expected volatility surrounding the 2024 U.S. election and protect themselves from significant market swings.
When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com - This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies.
General Disclaimer:
The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
MCLM2026 trade ideas
testchecking the first trade date is a very important date to consider if u are gonna dive deep into the gann feild , very long but exciting journal
A New Move Up On Crude OilTrendCloud Signal triggered on Crude oil today.
blue line: entry
Red line: stop loss
4 hour / 1 hour / 15 min charts all line up in trend strength and momentum.
Trade Plan link in my profile.
CRUDEOIL BREAKOUT ? FROM FALLING WEDGECrude Oil (1 Hour Timeframe)
Pattern: Falling wedge pattern, signaling a potential breakout.
Entry: Long position above 6040
Target Levels:
1st target: 6100
2nd target: 6140
3rd target: 6200
4th target: 6235
Stop-Loss (SL) : yours
Risk Management: Set stop-losses appropriately to manage risk and avoid potential losses.
Fundamental Factors:
Fed Rate Cut: The Federal Reserve's decision to cut interest rates is seen as positive for oil demand, potentially boosting prices.
Geopolitical Tensions: A recent attack on Iran-backed Hezbollah raises concerns about wider conflict in the Middle East, which could disrupt oil supplies and push prices higher.
Disclaimer: This technical analysis is based on the provided data and should not be considered financial advice. Trading involves risk, and past performance is not indicative of future results.
IF THIS WILL HELP YOU, PLEASE LIKE THE POST ❤️
CYCLICAL ANALYSIS - Crude Oil to Go Up To Mid OctoberDISCLAIMER: This is not trading advice. This is for educational and entertainment purposes only to show how I view this market. Trading involves real risk. Do your own due diligence.
My COT strategy has Crude Oil SETUP for longs if we get a TRIGGER (Confirmed bullish trend change). But what do cycles have to say about this long trade idea?
Cycles suggest that we should see an up move in Crude Oil until Mid October/Early November.
I look at many interesting things:
-Using the DOW Arab Titans 50 index as a leading indicator of where Crude Oil may trade to.
-The annual cycle of oil is strong and should not be ignored. It too is supportive of taking a long until mid October.
-The Decennial cycle is supportive of a bounce in oil into mid October.
-Major economic cycles & temporary trading cycles are also indicating an upmove could be imminent for oil.
-Lastly, we see that the previous most similar year of price action (2019) suggests oil could move higher into October/November.
TO BE CLEAR: This does not mean I am going long blindly, I wait for entry TRIGGER (18 MA, 10h8c MAC, Divergence). This market did already trigger via divergence last Wednesday via the CCI (Commodity Channel Index) divergence confirmation.
If you have any questions about my cyclical analysis, feel free to shoot me a message.
I hope you had a good start to your week.
And as always...
Good Luck & Good Trading.
Will a Jumbo Rate Cut Fuel Crude Oil Rally? US equities soared to record highs on higher-than-expected rate cuts by the US Federal Reserve. Additional rate cuts implied by the Fed dot plot signals a goldilocks economic scenario. A booming economy coupled with low crude oil inventory levels with intensifying geopolitics could tip crude oil prices into a rally.
Oil prices rose higher yesterday as hard economic landing concerns eased. Despite the rise, oil prices still languish at near-record lows for the year.
This paper posits a long position in CME Micro WTI Crude Oil Futures with an entry at $69.90/barrel with a target of $76.50/barrel and a stop at $67.30/barrel.
JUMBO RATE CUT BY THE US FEDERAL RESERVE
The Federal Reserve cut interest rates by 50 basis points (bps), bringing the federal funds rate to 4.75%-5%. With inflation easing and the labour market softening, the Federal Open Market Committee (FOMC) opted for the aggressive rate cut.
US inflation is nearing its 2% target. Job growth has slowed. Unemployment, though rising slightly, remains low. To maximise employment while guiding inflation on a downward trajectory, the FOMC delivered a 50 bps rate cut.
The unemployment forecasts were revised to 4.4%, up from June's 4% estimate. Inflation outlook was lowered to 2.3% from 2.6%.
NOT ONE BUT THREE OIL BULLS ARE LURKING IN THE SIDELINES
Rate cuts, low inventory, and intensifying geopolitical tensions could tip oil prices into a rally.
Rate Cuts and Crude Oil
Typically rate cuts boost oil prices by weakening the dollar and increasing demand for dollar-denominated commodities.
Tank-Bottom Inventory Levels
US commercial crude oil inventories have fallen to their lowest level in a year. Inventories at Cushing have hit tank-bottom levels. For now, a larger-than-expected drop in US crude inventories for the week ending 13/Sep had a negligible impact on oil prices.
The EIA reported a 1.6 million barrel decline, surpassing analysts' expectations of a 200,000 barrel drop.
Traders dismissed the drop in inventory, attributing it to temporary facility shutdowns on the US Gulf Coast due to inclement weather.
US refineries plan to undertake their lightest preventive maintenance season in three years as estimated by IIR Energy. Higher refining activity should result in increased demand for crude oil in the coming months.
Intensifying Geopolitics
Talks between Libya's rival factions have collapsed leading to a significant decline in Libyan exports. Compounding that are the escalating Middle East conflicts with pagers and walkie-talkies explosions in Lebanon.
OIL BULLS FACE FEEBLE MACROECONOMIC CONDITIONS IN CHINA
Earlier this month, OPEC , EIA , and IEA lowered their 2024 global oil demand forecasts, citing weaker demand from China's slowing economy.
Recent data shows continued weakness. Industrial output growth is at a five-month low. Oil imports are declining with slower refinery output. Property prices continue to fall. Retail sales growth remains tepid.
Housing prices continued to decline, with a 5.3% YoY drop, the steepest since 2015. New home prices fell 0.73% MoM in August, a sharper decline than July's 0.65% drop.
Property investment dropped 10.2% YTD, while housing completions fell 23.6%, indicating that declining property prices are deterring investment.
HYPOTHETICAL TRADE SETUP
When oil bulls lurking in the dark attack, expect oil prices to spike. Options markets are positioning for this scenario. Open Interest Put/Call Ratio at 0.77 as of 18/Sep in CME WTI Crude Oil points to a bullish slant.
CME Micro WTI Crude Oil Futures offer the same exposure to crude oil price movements as standard WTI futures, but at 1/10th the contract size, making them a more accessible and flexible option for traders, enabling more granular hedging.
This paper posits a long position in CME Micro WTI Crude Oil Futures with the following trade setup:
• Entry: $69.90/barrel
• Target: $76.50/barrel
• Stop: $67.30/barrel
• P&L at Target (per lot): $660 ((76.50 – 69.90) x 100)
• P&L at Stop (per lot): $ 260 ((67.30 – 69.90) x 100)
MARKET DATA
CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme .
DISCLAIMER
This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services.
Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
Oil Price Recovery Emerges Ahead of January LowThe price of oil recovers ahead of the January low ($64.37) to keep the Relative Strength Index (RSI) out of oversold territory.
Crude Oil Price Outlook
The price of oil extends the rebound from the monthly low ($65.27) to carve a series of higher highs and lows, with a break/close above $71.70 (61.8% Fibonacci retracement) bringing $74.00 (50% Fibonacci retracement) on the radar.
A breach above the monthly high ($74.41) opens up the $75.30 (61.8% Fibonacci retracement) to $76.30 (38.2% Fibonacci retracement) region but the recent rebound in crude may end up short-lived should the price of oil respond to the negative slope in the 50-Day SMA ($74.73).
Failure to hold above $68.50 (78.6% Fibonacci retracement) may push the price of oil back towards the monthly low ($65.27), with a close below $65.40 (78.6% Fibonacci retracement) raising the scope for a test of the January low ($64.37).
--- Written by David Song, Strategist at FOREX.com
CRUDE**CrudeOil:**
This week, after testing both key level's at 68.47 and 65.54, the price is expected to rise to the zone between 72.33 and 73.21.
My view on CRUDEOIL Crudeoil forming inverse head& shoulder pattern
Looking tgt 6000++ very soon...👈
Light Crude Oil Futures (CL1!) on the NYMEX struggle
Price Movement
Current Price: The current price is $71.00, showing a recent increase of $2.35 (3.42%).
Trend: The price has been fluctuating within a range, marked by a purple rectangle, indicating consolidation between approximately $60 and $80.
Volume
Current Volume: 1.45 million, suggesting moderate trading activity.
Historical Performance
The table below the chart shows monthly percentage changes from 2013 to 2024.
Seasonality:
March and April tend to have positive returns historically, with April showing an average increase of 4.38%.
October and November often exhibit negative returns, with October averaging a decrease of 2.18%.
Technical Indicators
The chart includes several annotations indicating significant price changes over time.
Resistance and Support Levels:
Resistance appears around $80.
Support is near $60, as indicated by the lower boundary of the consolidation range.
Conclusion
The chart suggests that crude oil prices are in a consolidation phase. Traders might look for a breakout above $80 for bullish confirmation or a breakdown below $60 for bearish signals. Historical data indicates potential seasonal trends that could influence future price movements.
CRUDE OILPreferably suitable for scalping and accurate as long as you watch carefully the price action with the drawn areas.
With your likes and comments, you give me enough energy to provide the best analysis on an ongoing basis.
And if you needed any analysis that was not on the page, you can ask me with a comment or a personal message..
Enjoy Trading... ;)
(Major trend break) BUY CL1! 4 hour trend break/retest confirmed on 15 min
4 hour lvl broken
prev 15 min being retested as we speak
take profit at next 4hr lvl
WEEKLY FOREX FORECAST SEPT 9-13th: S&P NAS GOLD SILVER US&UK OILThis is Part 2 of the Weekly Forex Forecast SEPT 9 - 13th.
In this video, we will cover:
S&P500 NASDAQ DOW GOLD SILVER US & UK OIL
Enjoy!
May profits be upon you.
Leave any questions or comments in the comment section.
I appreciate any feedback from my viewers!
Like and/or subscribe if you want more accurate analysis.
Thank you so much!
Disclaimer:
I do not provide personal investment advice and I am not a qualified licensed investment advisor.
All information found here, including any ideas, opinions, views, predictions, forecasts, commentaries, suggestions, expressed or implied herein, are for informational, entertainment or educational purposes only and should not be construed as personal investment advice. While the information provided is believed to be accurate, it may include errors or inaccuracies.
I will not and cannot be held liable for any actions you take as a result of anything you read here.
Conduct your own due diligence, or consult a licensed financial advisor or broker before making any and all investment decisions. Any investments, trades, speculations, or decisions made on the basis of any information found on this channel, expressed or implied herein, are committed at your own risk, financial or otherwise.
Oil9.11.24 it turns out that this video only talks about oil. there were other important markets such as the dollar and the currencies and also some commentaries on other markets that I've been looking at when a routine basis with these videos.... but there were some special things that occurred on this particular Market and it gave me a chance to talk about my concept of the smart money that can do things with the price action that can really mess up your Trading because what is good for you in your mind really is a bad trade decision because you're not really thinking about how the smart money creates patterns that are great for them and bad for you. obviously I can't give you cause and effect.... I can only guess and since I'm giving you precise descriptions and how this can play out you'll see if it's working or not because I'm telling you much of it before the market has a chance to show you what I'm talking about. no matter how good this is I know that 90 something percent of the people watching will never do the work.... they never do the work and I know the outcome for them will be failure when it comes to Trading. most people cannot deal with failure and risk and other matter that makes trading so difficult. most people don't realize how difficult it is to make money Trading and they don't make the effort to do what successful people do... is to work hard and test everything that you think you need to know before your risk capital. in general the smartest most successful people in markets have no interest in telling you how to trade. trading Is Not a Love Fest. my experience after many years at this is that most of the people I paid money to in the first couple of decades of my trading experience we're generally very disappointing but at least they got paid they made money because I had to pay for their wisdom.... it's obviously not their trading based on my experience. this video turned into a comparison of a bear trap ...and a bear flag. I'm not really sure if I'm naming them accurately according to Convention. ... and it is well known that the relationship to Smart money and fast money is a well-known topic. the assumption is that the smart money does something that eludes the fast money.
Crude Testing 50 Period on the 1 Hour CandleA lot of factors in play with geo politics, weather, economic slow down, and technicals. Any successful test and hold above the 50 period could yield a nice 5-10% move to the upside.
Oil Prices Drop on Weak China Demand & Gulf StormOil prices continue to drop as weak demand in China persists, despite disruptions from Tropical Storm Francine in the Gulf of Mexico. Latest data shows consumer inflation in China rising slower than expected, with crude oil imports rebounding slightly from July but still weak on a seasonal basis.
In the Gulf, oil and gas producers are shutting down platforms and evacuating workers as they brace for the storm.
📊 Technical Outlook: The market is approaching key support levels:
• 38.2% retracement at $65.16 (2020-2022 move)
• $63.64 (2023 low)
• $61.74 (mid-2021 low)
While these levels might hold during the initial test, it’s unlikely they'll prompt a reversal. With the market trading below the 200-week moving average and breaking the 55-month moving average, there's potential for prices to dip below $50 in the longer term. A negative bias remains below $84.52, and if support levels break, we could see a structural downtrend.
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The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
CRUDE**CrudeOil:**
This week, the price is expected to fall to the zone between 68.51 and 67.77, which coincides with the value of a key level for the reversal of the trend.
CRUDE OIL - BEARISH CONTINUATIONAfter drop raid last week. Crude oil are expecting to retrace during asian session to london killzone to form accummulation and manipulation. Hopefully a distribution will occur and bearish continuation is form
Crude Oil Getting Mauled!Lookout below! Chart looks horrific. Comment below where your bottom target is! if demand continues to be weak and supply grows, crude oil might see prices in the 60s or potentially lower if there's a significant event or policy shift
could Oil be headed back to the COVID-era $30 range ?
