Calls for a speedy return of the bull have been quieted as price continues to slump on supply concerns. Oil's protracted slump will cut supply and shift sentiment from optimism to pessimism. This process sows the seeds of the next bull market.
The latest Review of Crude Oil complements the analysis below.
Heating Oil Trend (Mixed)
Mixed trend oscillators define a transitional trend and deteriorating countertrend rally. The bulls control the (short-term) trend until reversed by a bearish crossover.
Leverage (Bear Phase/Bullish)
The flow of leverage (red arrow) has defined a bear phase since July. This sets the expectation of falling prices. The recent downtick, possibly a temporary pause in the uptrend, supports the countertrend rally.
Negative leverage oscillators define inflows. This trend also supports the countertrend rally.
Time/Cycle (Weakness)
The 5-year seasonal cycle defined strength until the first week of March. Sign of weakness - distribution under the cycle of accumulation and distribution or complacent distribution (Heating oil's CAP) will be shorted by the bears.