Technical Analysis

[Petrovale]

Can stocks take -14% oil from here?

[TomCrooz]

Optimistic view. A triple bottom is better than a double bottom. Hopefully the triple bottom is in and it will not fall lower. Comments from the experts?

Actually Pet, if we get a key reversal in and around the 43.50 area, it would be a quadruple bottom and very positive.  If you look at the last 3- 1/7/14(low 43.92), 10/15/14( low 43.25), 12/16/14( low 43.66), you see the same thing......a downtrend that hits support and then a strong reversal the same day to close positive.  I would feel very good it we had the strong reversal today to close positive( Croozian Reversal).  If we close below say 43....look out below with a further drop of 10-20% in very short order( 7-10 days)

If this will help some......I agree with Tom, this is fourth trip down to 43-44 area and is a good sign with support right below ioc, that it stands a good chance of a successful test here.  Just remember Edson Gould's old sayin three times is good, but look out for a fourth......meaning he felt it may happen and if it does it is likely the last trip down.  Also I subscribe to the three gap theory, meaning a gap lower (or higher the opposite) is moving towards exhaustion, two gaps lower is even better,  and almost never do we get three gaps lower, which is taken as total exhaustion.   Today is second gap down, another very good sign imo with the support right below us.

Last good sign is my short term strength rating which is usually quite good for trading bottoms, is at a very high 260, with 230-280 good market trading lows, reliability 80%+.

Next thing,  TLT Bonds is at overbought extreme coinciding with dollar extreme overbought also,  These are the antithesis of oil (and energy).....so what i am trying to say is nothing is perfect, but the ioc situation sure looks like things are lining up very well here......trans

One caveat,   watch out for an intraday spike seeming below support, only to recover back into a trading range.  this could be a fakeout move

-8.67% fall in 3 trading days after close below 43.  I am going to go with 38 ( 12% fall after breaking support) in the next day or 2 as the first attempt at reversal

-18.6% in 5 trading days since closing below 43.  It appears 31 is the next stop. If 31 does not hold, heaven help us.

[petrengr1]

Could the heavy selling and high volume in the first hour and a half indicate capitulation?

[sageo]

Tom- If 31 doesn't hold,I don't think even heaven can help us . I wonder how much blood the circling buzzards now smell ?

[sageo]

Tom- If 31 doesn't hold,I don't think even heaven can help us . I wonder how much blood the circling buzzards now smell ?

Correction ....!!  Maybe not buzzards, but instead "sharks" (like shark tank) ......only their names aren't Kevin,Mark,Barbara or Robert but instead Rex,Peter and the ghost of the TOT ceo .( no disrespect to the deceased intended) . Wish " happy daze" were here again !!!

[TomCrooz]

Could the heavy selling and high volume in the first hour and a half indicate capitulation?

We will see if it is capitulation if we get a reversal.  My guess is Chandler dumping more.

[Putncalls]

Transocean and Ensco are down big today again.

[trans]

great place to bounce here.....I still contend market pivot points happen around opt expirations last several years.  I also see TLT (bonds) and USD dollar at important overbought extremes and very likely finishing off important ob tops in the present areas.   Oil trades as an opposite to both of them and it too is at overSOLD extremes soon very rarely, meaning a number of years.  I like this combination here at opt exp and Jan leap exp is usually a tough one as it is.

Logical path my estimate?  An initial  bounce, usually about a week or number of trading days.  Likely near term resistance is in 40-45 area for IOC,  After initial bounce, a test of previous lows is in order, but doesn't mean exact low, just a rollover towards previous low would be fine with me, hold fairly well.  Then the next rally in IOC & crude that takes out first bounce (now the intervening low if ioc tracks normal) and that's a confirmation another important IOC low has been made, or a very high probability.  Usually first bounce is several points 5-6, next rally is better , maybe recovery to 45-50 and 5-6 months out 20+ points.  That would also coincide with lots of IOC news events.    Check out Nov 09 bottom forward action from $9 area and the time of recovery.........fwiw    trans

I also strongly suspect oil demise will happen sooner than expected, and the fundamentals of its recovery will be market discounted noticeably in advance of its following fundamental improvements.

[trans]

Apology ,,,,,not "intervening low" but Intervening HIGH of initial bounce.

[Tree]

I feel capitulated as of couple days ago.