Crude Oil Plunges -23%

Crude oil is trading below $20 after plunging over -23% on the final day of trading this week. In early trading, crude oil had been up trading higher, hitting a high of $27.89 before plummeting into the close. The reason for the plunge, social distancing, and border closings due to the coronavirus.

The coronavirus pandemic is demolishing crude oil demand in the United States as authorities encourage people to stay home and work from home while also discouraging domestic travel. Adding to that mandate is the closing of the U.S. - Canada, and U.S. - Mexico borders. Demand by the major economies in Europe, ranging from Italy, Spain, and France, are locked-down and unable to travel within their own countries and have advisories against traveling elsewhere.

All the while, Saudi Arabia, the United Arab Emirates (UAE), and Russia promise to flood the market with crude oil to the tune of a combined 4 million bpd next month when demand could be at its weakest as the pandemic is spreading.

The stock market sold off in the final minutes of trading Friday to close with the worst week of trading since the 2008 financial crisis. The DOW closed down -4.5% on the day followed by the S&P 500 with a loss fo -4%. The NASDAQ fared a bit better, only losing -3.7%.

However, the weekly losses are considerably worse, with the DOW losing -17%, S&P 500 -15%, and the NASDAQ with a weekly loss of -13%. It doesn't look like we've found the bottom of the fall yet.

Gold issued a new red monthly Trade Triangle, this indicating that the long-term trend for gold is down much like crude oil. Gold's loss on the week wasn't as steep, only losing -2.5%.

The U.S. dollar has been under the radar as far as I'm concerned, posting a gain of +4.6% on the week and issuing a new green weekly Trade Triangle indicating a move to the sidelines exiting the long-term downtrend. When was the last time that you saw the U.S. dollar index above $100? The answer was three years ago in 2017.

Bitcoin stopped the bleeding this week by posting a gain of +16% on the week trading just above the $6,000 level, but it still has quite a bit of work to exit the long-term downtrend.

Key Levels To Watch Next Week:

Every Success,
Jeremy Lutz
INO.com and MarketClub.com

3 thoughts on “Crude Oil Plunges -23%

  1. In my earlier post, I forgot one more issue, and that is about some more sensitive instruments. Over and above Currencies as an ultimate object, Bond market and Interest Rates will also accompanied in this party. Debt instruments and Bond may be victimized due to Very heavy selling pressure, along with un usual volatility. Such Basket selling may taken place as a part of some specific motive or strategy, I think, this may linked with, or a part of Currency War.

    I think, almost counters have lost their normal rhythm. Trade patterns found drastically changed, and even Technical Analysis is also became far more difficult to understand, so Students of Technical Analysis will get chance to learn some "Never Before" Lessons.

  2. Stocks, Precious metals, Crude oil,Bitcoin, etc.etc. almost counters found constant downtrend with extremely high volatility. However, this was just Sample, and try to tell us that where market wants to touch it's probable Bottoms, and therefore, real crack down is still ahead.

    Such initial collapse taken place because of Governments or some of Big Big Players may have some specific prior information regarding some strange matters or issues, or there may be a conspiracy or scandal, which are are under process to shape as Mass Financial Destroying weapons, and when that will publicly known, further spiral effects thereof will resulted in ultimate panic.

    Accordingly, When I make a deeper study of some key Charts, and as far as some key counters of financial sector are concerned, I just shocked, and found such apparent Lower Levels. These are, at present, just look like Impossible to capture. Also Currently it may consider as unbelievable, and so, Readers of my view may judge me as crazy or ultimate pessimistic, but time will tell the results.

    Specific levels yet pending to calculate, but Dow may turned sub 10,000 “Four Figured” Level. Gold may touch levels between $ 1000 to $ 1200 or even at around $ 800. Crude may touch between $ 11 to $15 or even at around $ 5 to $ 7 and ultimate object will be Currencies, with a sudden and sharp volatility with “Chain Reaction Mode.”

    Observing current overall scenario, situation is far more serious even beyond our imagination. Finally, I would like to clarify that I am not expressing such views as “ After Thoughts”. Even earlier too, for several times, I warned, and given all such possibilities and targets in my earlier Posts, since 2011

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