CRUDE OIL UPDATE (11:30 pm EST)
Over the last several weeks, the war with Iran has been driving the price of crude oil into a parabolic surge. Today, prices rose to a new monthly high and touched $117.63 (May contract chart) before closing the day at $112.95. In the evening, however, at the "11th hour" of Trump's deadline (8 PM) for Iran to make a deal with the U.S., President Trump announced that he had agreed to a two-week ceasefire to negotiate a 10-point peace deal as Iran agreed to open the Strait of Hormuz. The overnight oil market responded with crude prices dropping to $95 at the time of this writing.
It is late in the medium-term cycle of crude, and we have been waiting for the final top to this cycle and the steep correction to the final bottom to follow. This may be happening now (as long as negotiations with Iran don't fall apart this week). The fact that today's high was inside a new reversal zone specifically for crude (April 6 - 14) supports the idea that it may be the final top. We will now watch for the final bottom to this cycle as a possible spot to buy.
The high prices achieved by crude over the last few weeks may have bullish implications for some of crude's longer-term cycles. If that's the case, crude prices could get quite high - possibly exceeding the all-time high of $140. I will discuss this more in a later post. For now, we remain on the sidelines of crude oil.
Over the last several weeks, the war with Iran has been driving the price of crude oil into a parabolic surge. Today, prices rose to a new monthly high and touched $117.63 (May contract chart) before closing the day at $112.95. In the evening, however, at the "11th hour" of Trump's deadline (8 PM) for Iran to make a deal with the U.S., President Trump announced that he had agreed to a two-week ceasefire to negotiate a 10-point peace deal as Iran agreed to open the Strait of Hormuz. The overnight oil market responded with crude prices dropping to $95 at the time of this writing.
It is late in the medium-term cycle of crude, and we have been waiting for the final top to this cycle and the steep correction to the final bottom to follow. This may be happening now (as long as negotiations with Iran don't fall apart this week). The fact that today's high was inside a new reversal zone specifically for crude (April 6 - 14) supports the idea that it may be the final top. We will now watch for the final bottom to this cycle as a possible spot to buy.
The high prices achieved by crude over the last few weeks may have bullish implications for some of crude's longer-term cycles. If that's the case, crude prices could get quite high - possibly exceeding the all-time high of $140. I will discuss this more in a later post. For now, we remain on the sidelines of crude oil.
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