USO update 9/28

USO: many are bearish on oil, but what are the charts telling us. First up the regular price chart with our preferred count. Big spike today due to a supposed OPEC deal to cut production. Otherwise it’s been a big mess ever since the February low, as price is in fact where it was 6 months ago: $10s…



What we can do to reduce all the noise is to simple take away price and only look at the SMAs. Here we’ve plotted the 20d, 50d and 200d SMA: short- to long term trend lines. What we see is that all 3 SMAs appear to be bottoming out. The 20 is still below the 50, which is still below the 200, but if price remains above all 3 going forward these SMAs will start to move back up as well and set up a nice bullish signal: 20>50>200.  Once we get that setup, oil is in a bull. For now a little more patience appears to be in order.