USO Update

I've been very consistent on what  expect from USO based on the 3C charts.

 Here is the bull flag type pattern in USO, there was a 4-day breakout in which I have maintained that I did not believe this breakout would hold. My opinion has consistently been that USO looks good for the intermediate term, but first it will need to pullback into the flag and undergo accumulation to make a second and real breakout of the flag. The last 3 days, USO has pulled back into the flag.

 Here's 15 min 3C accumulation

 10 min 3C accumulation

 5 min leading positive divergence/accumulation

And the same on the 1 min.

I can't say for sure this is enough to effect a true breakout, USO may need to spend some more time accumulating a larger position, but I do see what I have expected. I would like to see a test of today's lows or perhaps a bit lower with an even stronger 3C 15 min positive divergence, at that point I would be very confident in a solid move up.

As for the dollar/Oil relationship, I stated about a week ago that I thought we were going to see some breakup of the normal, historical dollar correlations.

I haven't done an exhaustive study of the correlations, and this would be a new trend, but there are some recent indications that the inverse correlations are not as strong.

USO in green/ UUP in white