Tack this one on to the 5/29 post on oil (which links to the weekly WTIC chart).
The WTIC oil price has weakened further, down to $83 and change. A significant oversold is
developing for the oil price. It is headed down to the bottom of a range of $80 - 100 bl. which I
have felt is reasonable out through 2012. On a linear chart, oil, like the SPX, has broken down
from a 3+ year uptrend as worries about the global economic expansion's staying power have
again risen sharply.
I am watching it closely. The downside trading volume for the contract is approaching exhaustion
levels, and RSI and MACD are deeply down on the daily chart. WTIC daily
Since it is rarely smart to try to "catch a falling knife", I am going to watch for a little stability
in the price first. The chart includes the exchange traded USO (bottom panel).
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