We continue to be long-term bulls on oil, but we went short this afternoon for a trade. We are targeting down to the mid-50’s for oil on this EW chart setup. We have overlaid the US dollar index (inverted in blue) so you can see the correlation. (I.E. because the dollar index is inverted, when the blue line goes down it means the US dollar is actually increasing in value. Thus, oil and the dollar are actually negatively correlated, as you likely know.) The dollar staged a strong reversal rally this afternoon and looks as if it has more to run, even if this is not the major move we are expecting at some time. Either way, we think oil short here is a good trade idea.