Oil price has been trading around $49-51.50 levels for the last couple of sessions with several bearish divergence signals by the oscillators and currently forming a possible Head and Shoulders pattern with a neckline around the $49.70 level.
I expect Oil to break down and move towards the low 40’s as I see overbought signals with bearish divergence implying that at current levels I should be short. I already have short positions opened and will be looking to add if we have a confirmed break down below the neckline. On a daily basis we also have warning signals by the oscillators and I would expect a pull back towards the Ichimoku cloud near $45 at least.
Thank you for taking the time to catch up on my thinking.