Crude Oil Trading Small Specs

If you haven't visited or subscribed to Rich Olney's "Crude Oil Trading Small Specs" site, it's time you did. Rich provides some of the best crude oil trading calls available, worth every bit of the small fee he charges.

Here is his weekend call for June 20th....

"Crude Oil Thoughts"

Oh so close to a sell signal on the daily but not yet. The daily is still on a buy. Every pull back has been a buy so is this time diff? If the FED stays the course, which I think they will, Crude should make new highs before the pull back happens that everyone is looking for. I will add more to this string later but the commercials increased their OI last week and reduced their net short position as well not bearish action by any means. Also the USO chart is misleading since it is the second derivative and we are in contango market use the futures contract..........(USO chart paints a diff picture).

I think we can get the big sell off many are looking for if the FED changes their bias statement to indicate a move away from quantitative easing (QE). The current US QE policy is the main reason for the oil rise and dollar weakness. So that is what oil traders will be looking for a change to the current QE policy in the Wednesday FED statement. If no change to QE policy then more of the same declining dollar and rising crude oil. So if you are shorting oil looking for an IT move down then you are betting that the FED will change their QE stance on Wednesday IMHO.

You can see on the chart below from the 2008 bull market that 38.2% and 50% retracements on the daily chart were par for the course and a buying opportunity every single time. Buying the pull backs at the the 38.2% and 50% retracements was the way to go till the trendline on the daily broke.

Crude is currently at the 50% retrace at 69.90 which is the half way mark between the previous swing low at 65.92 and swing high at 73.90. So my point is the daily trend line is not broken, and we are at the 50% from the last swing low to swing high which when looking at the last bull market was a golden opportunity to buy. That's what has me long here despite all the bearishness on crude.....Click Here For His Complete Post and Charts