While investors are still trying to determine how the Bureau of Labor Statistics got it so wrong with the Jobs Report, there is another story that seems to be getting little or no coverage, which is the attack on the US Dollar initiated by the BRICS Alliance.
It is no secret that momentum is building around their master plan to remove the US Dollar as the Global Reserve Currency. According to BRICS, the GDP of their nations accounted for 31.5% of the Global GDP as of 2023, and the alliance is growing.
The International Monetary Fund (IMF) has also stated that the BRICS nations still have a significantly higher growth forecast at 3.6% compared to the G7 Nations average of 1%.
If their de-dollarization plan is successful, the dollar will plumet and the inflationary effect will be devastating for the US Economy. Oil companies will most likely pass on the added cost of crude oil to the end line consumers, but it could increase their profits as they pad their margins.
Could this be the Black Swan event that bearish traders have been waiting for? Perhaps, but the charts are giving us a clear signal that the oil stocks could rally from here.
Below is a daily candle chart of the Vaneck Oil Services ETF. On Friday it closed with a long bullish candle on higher volume. The Stochastic Oscillator is about to cross with a buy signal and the Commodity Channel Index (CCI) has just crossed the momentum line. My upside target is set at $319.50 which would bring the price up to the gap fill point. Note: This stock has reached my price targets 29 out of the last 35 times I’ve analyzed it. While an 82.9% hit rate is impressive, it does not guarantee future results.
For more great trading insight/education, trade publications, & market commentary from AJ, please visit StickyTrades.com
