A Refined Analysis of Crude Oil
WD GANN: SOME REFINED ANALYSIS ON THE CRUDE OIL MARKET
The mysteries of the recent massive decline in Crude Oil are many, but, two questions of import rise to the top of the list . . .
- Why such a massive decline?
- And, how can we tell when the decline is either over or going to continue?
THE FIRST QUESTION: Well, the first question is simply that Time ran out for CRUDE OIL at high prices.
The approximately 30-year Commodity Cycle which last strutted it’s stuff in 1980 was due and came at last to the crude oil market as it did to the grains, copper and gold markets.
THE SECOND QUESTION: As for the second question of where we are within the Crude Oil downtrend, we’ll further refine our answers in the next two charts which follow and which may provide some valuable guidelines to temper our emotions when watching the daily price action.
Many expect a rebound in price. Perhaps even a reversal in the trend. But, how will you determine ‘the real deal’ from the ‘hopeful’ emotional response?
WD Gann, THE market master from the last Century found several ways to answer these questions.
Indeed, these rediscovered techniques of his have proven, at least to me, that Gann was a true Renaissance Man.
As a market analyst genius, he is, even today, largely unappreciated and undiscovered by the vast majority of investors and traders who think his claim to fame are a few stories, some strange angles, mysterious circles and enigmatic squares which he left behind in some notes, charts and courses.
One of the marks of true genius is, however, when the techniques discovered still work over a Century later!
Yes, Time is the great tester of Truth.
So, let’s take a look at Crude Oil, like we did previously for the Stock Market and Gold through WD Gann’s eyes, so to speak and applied to today’s price charts.
The chart below shows where the present invisible Resistance price level is for Crude Oil.
A counter-trend will have to be able to break through the $55.00 price area to confirm enough buying pressure is available to absorb the selling pressures presently in the market.
This answers the question as to if we’re in an uptrend or not: Until prices rise above 55.00 and hold; we’re still in a downtrending market.
At present, we’re experiencing a pause in the downtrend. The next question becomes then; how will we know if the downtrend is going to resume? That answer is also supplied from the lost Gann secrets and is illustrated on the chart below for your examination . . .
The chart below shows where the present invisible Support price level is for Crude Oil.
This chart answers the question as to if the downtrend will be continuing or not: Until prices fall below 41.00 and hold below that price; we’re still in a sideways trending or holding market for Crude Oil.
These are the price limits for support and resistance on a daily basis for Crude Oil as of this date. – George