Can #Oil Fall Back to $20? = 31.07.2022 = #WTI #energy @markets @ft @wsjmarkets #commodities @CNBC #usoil #CL1! @seekingalpha @marketwatch #Educational #oilandgas $USO

It can! And there are several technical reasons for that:

  1. The monthly MACD line ticked down in July. Though it is not a catastrophe yet, it is worth noting that the line was at the second highest of all time. Two similar technical conditions (MACD and a few other indicators together that I track) occurred twice in the past: in 1990 and 2008. If oil confirms this time, it would be the second worst.

    MACD has two paths to explore from here. If it reverses up and continues to move higher, it will only exacerbate technical conditions, just postponing the crash. If the line continues down and crosses the signal line, oil will go down significantly.

    We can estimate the future move based on two samples. It is statistically insignificant, but still.
    In 1990, peak to trough, oil lost about 66%. In 2008 – 77%. As the current case is positioned as the second worst, we can assume oil could land somewhere between, say 71.5% or about $37.

If you think that everything aforementioned are just technical fantasies, I would like to share this Bitcoin MACD study that was shared with subscribers in January.

This is the same chart taken today.

Still not convinced?

But this is not everything. I have not talked about possible move towards $20 and would like to bring different techniques into the study and look from various angles.

If you want to continue reading, please subscribe.

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