What Do Middle East Cycles Portend for 2019 – 2021? Will Crude Rebound in 1Q/2Q ’19?
What Do Middle East Cycles Portend for 2019 – 2021? Will Crude Rebound in 1Q/2Q ’19?
11/29/18 INSIIDE Track: Outlook 2018 – 2019 – Energy & the Middle East
It is important to periodically step back and revisit the longer-term (3 – 5 year, 5 – 10 year, etc.) outlook and see if, and/or how, current events fit into that perspective. (If they do not fit, it could be a case of an event that is an outlier or it could force a reassessment of that broader outlook.)
One of the expectations for 2018 – 2021 has been for an intensification of a Middle East shake-up that ultimately leads to a Middle East Union. That unification, if it comes to fruition, would likely occur near the end of the cycle (2021). Leading up to that culmination would likely be an increasing of pressures – economic, geopolitical and/or military – in related nations.
This time period (2018 – 2021) is the culmination of diverse cycles – dealing with everything from past Arab Unions (the most noteworthy in 1958 – 1961, precisely one geometric 60-Year Cycle (of Life) ago) to Israel & Jerusalem cycles (that were projected, for over a decade, to witness a major shift in Sept. ’17 – Sept. ’18) to oil cycles and to stock market cycles, that have overlapped oil cycles in recent years.
As an added gauge of what to expect, those oil market cycles provided key clues – focused on the first 10 – 12 months of this 2018 – 2021 period and the potential for a major peak in 3Q 2018, ideally between late-Aug. and late-Sept. 2018.
That dovetailed with Middle East cycles that projected late-Sept. ‘17 into late-Sept. ‘18 for a steady ratcheting up of tensions to coincide with a ~12-month advance in oil prices (the second phase of an overall ~32 month advance from 1Q ‘16). True to form, the two moved hand-in-hand.
And that led to 3Q 2018, when 10-Year & 5-Year Cycle Progressions, as well as a myriad of monthly & weekly cycles, projected a 6 – 12 month (or longer) peak in Crude. Another intriguing cycle also reaches fruition in 2018 (-2021) and is closely related.
It involves the 70-Year Cycle of Kings & Kingdoms, stemming from the 1948 discovery of the world’s (still) largest oil field (Ghawar) in Saudi Arabia. That field came on line in 1951 and since that time, Saudi Arabia has been king of the hill. That power has all been directly linked to oil.
However, late-Sept./early-Oct. ‘18 might be remembered as a fortuitous time for Saudi’s power and influence. And if their ‘70-Year Kingdom Cycle’ transitions in 2018 – 2021 (70 years from 1948 – 1951), it could have far-reaching ramifications. There is a season for everything.”
Crude Oil has plummeted since peaking in early-Oct. while fulfilling multi-month, multi-quarter & multi-year cycle highs in/around late-Sept. 2018… and also completing the latest phase of Middle East cycles that projected higher oil prices into late-Sept. 2018. The next phase of bullish oil cycles is projected for 1Q/2Q 2019 – leading into a potential (secondary) high in/around May 2019.
Energy/Equity connection projects early-Dec. rebound high before bearish cycles re-emerge. From a price perspective (price action is the ultimate filter), Crude should reach 1 – 2 year support/downside targets at 47.90 – 48.55/CL and ultimately attack 2 – 3 year support at 42.05 – 42.65/CL before multi-month bottom becomes more likely. Longer-term cycles argue for a bottom in Crude in Dec. ‘18/Jan. ’19, followed by a rally into ~May 2019.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.