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Crude Oil has traded inside of rising channel (A) for the past couple of decades and not even the financial crisis in 2009 could cause Crude Oil to break support of this rising channel.
The break below the multi-year pennant pattern a couple of months ago has caused a good deal of selling in the Crude complex, as it falls like a knife. Crude didn’t even pause as it was slicing through channel (A) support.
Almost 90 days ago, when Crude was trading above $90, the Power of the Pattern suggested that a break of support could send Crude down to $70 at least. (See post here)
For nearly 20 years, Crude traded inside of sideways channel (1), which was tested as support back in 2009. With Crude breaking down, the next long-term support comes into play could be channel (1), around the $35 level, which was hit in 2009.
What countries will be impacted by lower oil prices? Yes Russia and Saudi Arabia could be impacted, don’t forget that the United States could too!
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