Hmm bottom forming ?

I don't think so at least with the way I read the charts. I think oil will have to go to 30 before a bottom forms. Now that its blown through the support level at 50 the next one is at 30. It could turn now but thats pretty doubtful.

And to be clear I continue to assert oil could readily hit 150 or more in a matter of weeks just depends on when the market wakes up and what the real demand supply situation is.

But I'm pretty sure that in the interim we should see 30 first. It will be interesting to see it turn before it at least touches 30.

Now if the market blows through 30 god knows what the floor price would be I don't think we have any other fundamental base for a floor forming.

However I think that if we do hit 30 like I suspect we will see some serious cuts in supply that are probably unwarranted. We have a little resistance at 40 but I suspect the current bear market rally in the stock market will falter and this will work to allow oil to bust this temporary support level at 40 sending it on down to 30.

I don't think this bear market rally in the stock market will really take off until we see the bond market bubble collapse so I think we will see a number of still born bear rallies.

Whats worse however is if oil does punch through and head for 30 its going to send North American NG to 4 which is going to devastate the US UNG plays.

Now if this is the "real" bear market rally then oil could turn now and stocks turn first and that takes out the bond market. In any case we are certain to see yields turn around on the bond market eventually it get very volatile as the interest rates drop so I can't see the bond bubble lasting much longer.

Also although I think the current oil market is dysfunctional it is betting that KSA can do nothing to control the slide in oil prices and I really think that prices will continue to decline at least to 30 now until it becomes obvious that we do or don't have enough oil. So once the market answers this question it will become functional again.
It as three low price equilibrium points 50, 30 and say 15 although I've got no idea where the last one is. If we have plenty of oil it will settle on one of these three. If not then we don't have any long term stable points until we hit 200.

Really sticking my neck out I think we will smash below 40 before the end of the week and potentially see 30 in the next two weeks.