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Big news over the weekend concerned OPEC+ delaying the return of Output reduction by one month and Crude bouncing also potentially on news of retaliation by Iran to attacks by Israel post the US Election. As daily WTI Crude (front month) futures charts show, the decline in October was likely a clear five-wave decline. Thus, while a minor bounce is underway, it likely won't prove too strong before another pullback down to new lows in December. Volatility has risen for Crude, but not unlike what's being seen in many assets ahead of the Election. Technicals for both C0.00% rude and Energy as a sector are negative into next year, and bounces should be seen as temporary before prices turn back lower. (CL-1.26% _F) XLE0.12%  OIH-0.30%

Lot of investors wondering if C0.00% rude is bottoming, and i do NOT feel this is the case technically, though i can make the case for another 2-4 days of gains back up to 73.45-74.50 before this peaks and goes back to the lows. Structurally this remains bearish, Elliott patterns suggest a good likelihood of $50 oil, DeMark exhaustion is not in place and cycles remain bearish until Summer 2025. Thus, while a short-term bounce is certainly underway for Energy as a sector as Geopolitical risk has elevated, i don't suspect this will prove long-lasting. Technically speaking, bounces would be used to Trim/take profits/hedge Energy as of early next week. (CL-1.26% _F) OIH-0.30%  XLE0.12%

Front month Crude futures are dropping sharply, lower by nearly 3% to the lowest since early January 2024, and it's thought that the feeble recovery in China is also stoking fears about low demand for Crude. WTI Crude could find temporary support in the mid-60s but i fully expect a possible drop to 50 or below into 2025. OIH-0.30%  has violated support and both XLE and XOP are quite weak this morning. Equal-weighted Energy is on the verge of breaking intermediate-term support vs Equal-weighted S&P 500 which has held since 2022. Overall Energy is a technical Underweight, and i expect additional weakness

I discussed technically last week whyOIH-0.30%  might face some resistance heading into this week, and today'sSLB-0.49% ,BKR-0.41% HAL-0.22%  losses (4-9% in today's trading) have resulted in OIH pulling back sharply from trendline resistance. I expect today probably marks an attractive opportunity for traders. yet, trend followers will require a rally back above this ongoing downtrend. this will take time. At present, OIH is well up off early lows and this is encouraging after the early decline

WTI Crude has quietly lost almost 7% off its peak in the last week, but nearing support, and the wave structure suggests a bottom this week and a push back to minor new highs. I'll discuss my projections for Energy and Crude in tonight's report, but this first pullback makes Crude and by extension, Energy, an attractive risk/reward, and i expect a push back to 96-98 in front month Crude FuturesCL-1.26% _FXLE0.12% OIH-0.30%