Friday, April 28, 2017

Oil Price Seems To be Building A Base

Oil has been trading in a range for a few days, actually a couple weeks. Price has drifted down steadily since April 12.
There are a few resons for that, one of them being increased US production.
Another reason is the oversupply.
And a third reason for soft prices is uncertainty as to whether OPEC will agree to extend their quotas.
If there is not an extension of the quota, Russia has new fields to bring into production and other nations will be wanting to increase as well.


This chart is clearly showing that there is no direction, just indecision.

However, that is the current market, this week.

What looks good in future is that new reserves are not being discovered as in past years. Exploration is down and many wells are old and close to being finished.

Worldwide demand is poised to increase as economies recover.

Here is a Point and Figure Chart


As you can see on this chart, price has been in a range for a long time. Oil is building a strong base and we will see quite a move as time passes.
We do not know when the rise will begin but looking at the base being built we can know there will be a significant rise in future.


This chart, a monthly chart, has a bullish Fibonacci Pattern, indicating a rise in future.

This last chart is an Elliot Wave chart from earlier in the month. You can see that the chartist expects a rise in future. I am sorry that I can not provide a more recent chart, I will be watching to see if one is produced as days pass.
(Chart courtesy of Forex Crunch)

Current world events such as the Korea US negotiations could easily provide an impetus for price rise.

No comments:

Post a Comment

Newer Post Older Post Home