Oil dropped after OPEC+ decided to pump more of it. This counts as news because apparently we needed a formal announcement that when you make more of something, the price goes down. Groundbreaking stuff from the cartel that's been doing this exact dance since 1960.
The Strait exports are recovering. Traders acted surprised. These are the same people who bought crude at $120 thinking it was heading to $200 because a guy on Twitter said so. Now they're holding contracts underwater while OPEC+ literally tells them more supply is coming and they're still checking their charts for hidden bullish divergences.
Here's what happened: OPEC+ held a meeting. They agreed to increase output targets starting in August. Oil fell. Retail traders who bought the dip last week are now explaining to their spouses why technical support at $73.50 was supposed to hold because the RSI was oversold on the 4-hour chart. The RSI does not care about your margin call.
Global supplies are potentially increasing. Potentially. That word is doing a lot of work in that sentence. It's the same word your broker uses when he says your portfolio could potentially recover if you just hold on a little longer and stop looking at your account balance every fifteen minutes like a rat pressing a lever for cocaine.
The best part? This whole move happened on a Monday. The market opened and immediately punished everyone who spent the weekend convincing themselves that geopolitical tensions would keep prices elevated. Turns out geopolitical tensions lose to basic arithmetic when OPEC+ decides to turn the tap.
Your technical indicators didn't see this coming because technical indicators are just expensive horoscopes that update in real-time.
Photo by Zbynek Burival on Unsplash
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