Predictive Modeling Suggest Oil Headed Much Lower
Our Adaptive Dynamic Learning (ADL) predictive price modeling system is suggesting Crude Oil will likely continue to find resistance near $64 as a price ceiling and trend lower over the next 3 to 5 months – eventually breaking below the $40 price level near the end of 2019 or in early 2020.
Our research team believes this move could very well be contingent on a continued decline in global economic activity as well as our research suggesting that global currencies could be setting up for a breakdown event.
The USA and FED will do everything in their powers to keep the economy looking strong and to hold markets up like talking about rate cuts, but eventually the music will stop, but until then we need to be long and strong stocks and keep a close eye on leading indicators like small caps, oil, transportation and industrial sectors for early warning signs.
Please read the following research posts for more information:
Report #1: PART III – DEBT CRISIS TO BE REBORN IN 2020
Report #2: KING DOLLAR RIDES HIGHER CREATING PRESSURES ON FOREIGN ECONOMIES
Report #3: FEAR DRIVES MARKET EXPECTATIONS
We believe the breakdown in support for Crude Oil will coincide with a general perception of global economic weakness, foreign Central Bank posturing and the possibility that foreign currency weakness may push global demand for Oil much lower than current expectations.
The volatility increased suggested near the right side of this chart, in late 2019 and early 2020, are indicative of oil prices reaching a critical support level while attempting to re-balance supply/demand-side economic factors against historic price lows. This will likely become a period where global oil traders feel the need to try to push oil prices higher while supply/demand factors settle to establish a basis price level for future price trends.