FinancialMarkets Crude Oil Ready to Slump again for June Contracts
I woke up this morning to an announcement from CTFC (Commodity Futures Trading Commission) which is the regulator for commidities trading, in which they issues a WARNING to brokers, trading houses et al that Oil prices may go negative again running up to the June Contract expiry on 19th June 2020, which is next Tuesday (today is Thursday 14th May).
They also mention this is not investment advice, this is merely warning so that trading houses can take precautions, to prevent huge losses for investors etc. But lets face it, this is just admitting that there is a very high probability that oil prices - that is the spot cash price for WTI crude, will go negative again.
So this was reassuring given that i been waiting almost a month for this to materialise, and recently oil's been moving sideways fro the last 9 days which has been perplexing me.
I've been following the oil chart like a hawk, but nothing seems to be happening. But today it got me thinking...all this while i was looking at the hourly chart to find the finer detail cos i usually use hourly chart after seeing the broader daily chart. But there is too much noise on the hourly chart, and it's not obvious what is happening.
So today I decided to zoom out into 4 hourly chart to eliminate most of the noise shown on hourly, and bingo! It became very obvious that "it is happening again".
Check out the chart above, you will see we have the same chart pattern formation, same technical indicator formation as the run up to 20th May 2020 when crude oil plummeted.
It is time to go in SHORT now. HOWEVER... keep in mind there will be systems in place to try and support the price of oil this time. They may have circuit breakers to suspend trading. Brokers and Trading Houses may set limits on how much shorting can be done, and may not even let you. My CMC Markets trading platform doesnt even let me short WTI cash anymore.
Good luck and invest Safely.
The black chart above is for BRENT Crude Oil, and the one below is for WTI crude oil
Oil
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