Oil Prices Have Become Unpredictable

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Are oil prices less predictable? Yes and no.

YES.         As technical analysis software has improved drastically, traders/ investment banks etc. are following the same path. 10 years ago when we saw a "w" in the graph it was a definite buy, or "m" a definite sell moment. Look today at the graphs and you will notice this effect is gone. If we all believe this is the moment to buy (when looking at the chart), others start taking short positions. Rightly so. The effects disappears. Thus the swings get less. My experience over the last years analyzing graphs.

NO.         Day traders do follow the charts, longer term traders might also look to fundamentals. You can easily buy good technical software analytics tools. Fundamental knowledge is different. Indeed so many factors are unpredictable; politics, OPEC, social unrest, supply versus demand, unreliable data etc. etc., that understanding the economics of refineries, crack spreads, derivative pricing with their margins ( for example the price of oil to naphtha to propylene to PO) is key to make some money in the long run. Yo need a lot of info;). But at least that are facts.

Sometimes it can be noticed that with certain oil price and aspects, as mentioned above, the oilprice has to increase, or to decrease within certain time frame. If logic prevails. This happens only a few times in a year. Understanding this complex market takes time, but will bring you some sustainable income, compared to just following the technical analysis.That why I enjoy the knowledge on this platform.

So yes, I think oil prices are less predictable. But some times it is predictable, and then, finally, money can be made. Business wise or personally.

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(edited)

On 9/4/2019 at 7:35 PM, Dr.Masih Rezvani said:

There is a chance of tension at any moment
There is a chance of agreement at any moment

I don't see agreement at any moment in the near term. The USA and China both have way too much pride to concede anything and form a workable deal 'soon', if at all. They can have talks all they want. They were close to a deal and China removed the clauses that what they were signing would be checked upon in the future. What does this tell you or suggest for future talks or deals? 

Every tariff added, every barrel of Iranian oil bought, every Huawei disagreement, every agricultural loss, this stuff adds up and is not simply forgotten by the home country. Then add to that an election, an anniversary and Hong Kong. All nothing to do with trade war but on their plates. 

Tension any moment I agree.

 

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38 minutes ago, oilexpert.nl said:

Understanding this complex market takes time, but will bring you some sustainable income, compared to just following the technical analysis.That why I enjoy the knowledge on this platform.

I agree but think some people underestimate the technical analysis part. This is still primarily what I work off. 

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