Here’s what history says about Crude Oil performance during the last quarter (Q4)
I have mentioned on 5 Nov 2021 that a change of character bar showed up in crude oil (as circled) on 4 Nov and the up move is stopped for now with the immediate support around 75, as shown in the screenshot of my Telegram Group below:
Since then, crude oil had a test of the supply zone followed by a reversal and a reaction. Last Friday, it was testing the support zone (as boxed up in green) near 75, as shown below:
Now, let’s take a look at charts of Oil Services ETF (OIH) and Oil & Gas Exploration & Production ETF (XOP) as a representation of a basket of the crude oil related stocks below, where I have highlighted the bar on 4 Nov in yellow because this is where the change of character bar showed up in the crude oil chart:
Since 4 Nov, both OIH and XOP have broken below the support and on a sharp down move. This is not unexpected since these two ETFs are closely correlated with the crude oil performance.
