Rekt Fencer
Founder of X DAO, Crypto Trading Guides
The oil trade is over because crude can no longer make higher highs, even with Middle East crude exports back near their peaks. Oil is trading around its average price of the last eight months and set a lower high in September, so it is only a matter of time before the market gives up. Crude looks about to fall through the floor, with rates following and high-beta stocks then going vertical as every dip gets bought. x.com x.com x.comÂ
Crude oil will probably drop again as it retests the underside of its highs. Oil bounced off a key level just as geopolitical tensions resumed, and its moves track chart levels, with news arriving to fit them, until it reaches the next key level and bounces. x.comÂ
Oil demand will far outstrip supply regardless of alternative energy sources, driven by AI, reshoring, massive money expansion and global industrial growth. All energy sources will be needed to the max. x.comÂ
Plummeting base costs and weaker demand from struggling economies abroad should push crude oil lower next year. The same forces will also weigh on many other commodities and services. x.comÂ
Crude oil's mid-term trend should turn lower sooner or later, a shift that would line up with a final ceasefire deal. Despite short-term volatility, prices are still distributing around the higher-timeframe resistance that marked the 2022 macro top. x.comÂ
Crude oil and the XLE energy-sector ETF would be buys on a pullback because uncertainty over a real military strike could hang over the US market from the midterms through year-end. Only an actual strike or a true peace deal would settle that uncertainty. x.comÂ
Crude oil should keep moving lower even after the midterms, because 2027 economic projections point to lower inflation. Around $100, oil was a good short since policymakers wouldn't let it break out ahead of the midterms and risk voter confidence. Some volatility is likely at first. x.comÂ
Crude oil should fall back into the $60s and likely well below over time once the Iran war is resolved. Middle East producers are overproducing but cannot export the barrels, so when the Strait fully reopens they will flood the market. Oil tried to break down from its trend line but was rejected, and bigger resolution news is likely needed to push it much lower. Cheaper oil would remove current inflation fears, setting up a deflationary boom. x.com x.comÂ
Crude oil's long historical correlation with gold and its lag behind gold make an oil catch-up to $200-$500 almost a lock. Oil-to-gold stands at 0.03 against a 75-plus-year upper range of 0.15; even a move to around 0.08 would mean oil rising 2-3 times against gold, gold falling 50%-66%, or both moving. Demand would probably hold up to around $300, though it could break closer to $500. Such a surge is not an outcome to cheer for. x.com x.com x.com x.com x.com x.com x.comÂ
Extreme bullishness about an oil shortage is a warning because oil has tended to return to around $50 within 12-18 months after such talk. Calls for a 'great oil repricing' appeared today, though they may not be widespread enough yet to mark the same setup. x.com x.comÂ