I think the bottom is in for this week and it could also be the bottom for a while even if 25 is eventually reached.
Reasonning: 13 waves down with wave 13 target at 47/43 (reached band high this morning). 7th month down (2008/2009 was also 6months and rebound on 7th) Last wave is already longer in time than wave 11. 47/45 is Long term linear and logarithmic support (VERY difficult to break below on first touch. I have the impression SP500 wants to go back up and can’t see that happening if further dives in WTI right now… Implicit deduction: WTI could have bottomed.
>>> today could be a large volume up day.
It could be wrong, the sizing is nimble enough to sustain excesses or even a dive (which I see unlikely).
Kommentarer
CommoditiesTrader
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I think it is still too early. Fundamentals still not on oil's side, and the crunch on US shale will continue. There is a bit of support for a bounce, but there is no bottom. I look for WTI to reach $43 in the near-term. tradingview.com/v/mUWM8Cv5/
YaKa
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43 is next door - very possible
The final bottom could be much lower indeed - maybe 24.
Interesting information about shale. You may be right then.
I like to understand fundamentals and what drives the price lower or higher but from experience: fundamentals do not give you the bottom or the top.. At the top, news are great. At the bottom, news are ugly.
The bottom could be lower but I do not expect to read positive analysis at the bottom.
i think there should be a rebound from 47/43. we do agree more or less.
the question is: what will be the magnitude of this rebound and its length in time.
YaKa
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I add, bottom are sold and tops are bought. Not the contrary.
CommoditiesTrader
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I agree with you. Unfortunately, traders look for that magic number that ignites liftoff, constantly going against the trend. I believe we could see 2008 lows if economic data continues to decline.
CommoditiesTrader
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Fundamentals do not give a bottom or top, but it creates sentiment in my opinion. And trading against sentiment IMO is not easy nor sometimes wise.
YaKa
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Vast debate.
I think:
- Fundamentals are in full shape in the midth of a move.
- Then price drives sentiment. So I emphasize: at the bottom, the sentiment will be very bad and at the top very euphoric.
Then, it s a question of trading style.
If you are contrarian (I think i am, although i am trying to tune it down), you need to get used to do what your "model" is telling you and be used to hear most people say the contrary of you think/do....
If you are a trend follower, you wait for the move to be initiated and confirmed. But to do that well you need to act in the first third of the move... I see too many trendfollowers coming for the tail of a move when it appears comfortable to them (which often is where i start thinking reversal...).
YaKa
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So here, my purchase is tiny in size as i am aware it may go to 43 or even to 25 (i dont believe straight but it is a possibility)... even in that very bad case: I would bear a negative -250bp when crude falls 50%, bearable....
if i am right, i have a quick move to 55/60 and i take 100bp profit.
From here although the daily moves prove you right every day, i become increasingly scared to bear short as any one day could be a large squeeze... I think there will be 7usd move up day soon.
CommoditiesTrader
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I am a trend follower, but I fully recognize that there are often opportunities to trade the opposite direction. I have been known to be long or short and play smaller moves synthetically through other means.
I initially went short above $74 on a trend break from 2008's high. I tend to have a unique approach to markets and analysis, but it's worked for me.
Ok. I ll read you with pleasure. Following you to see how you think/what trades you put on. Interesting chat.
CommoditiesTrader
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Absolutely. I love talking/debating ideas on markets. So many ways to approach markets and perspective. They're so dynamic the learning process never ends.