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Monthly Crude Oil Bull Leg

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Market Overview: Crude Oil Futures

The market formed a monthly Crude oil bull leg. The bulls want a retest of the bull leg extreme high (Jun 23), even if it only forms a lower high. The bears need to create strong bear bars closing below the 20-month EMA to show they are back in control.

Crude oil futures

The Monthly crude oil chart

Crude Oil Monthly - 4-Bar Bull MC, Bull Leg, Near Middle of TR, Monthly Crude Oil Bull Leg
  • The July monthly Crude Oil candlestick was an inside bull bar closing near its high.
  • Last month, we said traders would see if the bulls could create a retest of the June 23 high, or if the bears would be able to develop a retest of the April 9 low instead.
  • The bears see the move in June as a bull leg and a buy vacuum test of the trading range high.
  • They want the market to form a lower high (Jul 30), followed by a bear leg to retest the trading range low (Apr 9 low).
  • They need to create strong bear bars closing below the 20-month EMA to show they are back in control.
  • The bulls got a bull leg and a buy vacuum testing the top of the trading range in June.
  • They want a retest of the bull leg extreme high (Jun 23), even if it only forms a lower high.
  • The move up is in a 4-bar bull microchannel, indicating persistent buying. There could be buyers below the first pullback.
  • If the market trades lower, they want the 20-month EMA to act as support.
  • The market remains in a trading range.
  • Traders will BLSH (Buy Low, Sell High) when in a trading range until a breakout with sustained follow-through buying/selling.
  • That means buying in the lower third or selling in the upper third of the trading range.
  • The market is currently trading slightly above the middle of the trading range.
  • The middle of the trading range is an area of balance and a magnet.
  • For now, traders will see if the bulls can create more follow-through buying to retest the June 23 high.
  • Or will the market form a pullback to retest the middle of the trading range (20-month EMA) instead?
  • Poor follow-through and frequent reversals are hallmarks of trading ranges.

The Weekly crude oil chart

Crude Oil Weekly - Double Top Bear Flag, Middle of TR
  • This week’s candlestick on the weekly Crude Oil chart was a bull bar closing in its lower half with a long tail above.
  • Last week, we said traders would see if the bears could create follow-through selling trading below the 20-week EMA, or if the market would continue to trade sideways to up instead.
  • The market traded higher, but there was no sustained follow-through buying. Crude oil continues to trade sideways above the 20-week EMA.
  • Previously, the bulls got a bull leg and a buy vacuum to retest the top of the trading range.
  • The market then formed a deep pullback to the middle of the trading range.
  • They want the 20-week EMA to act as support, followed by a retest of the June 23 high, even if it only forms a lower high (Jul 30).
  • The bulls must create more bull bars to increase the odds of a retest of the trading range high.
  • The bears see the rally (Jun 23) as a bull leg and a buy vacuum within the trading range.
  • They want the bear leg to retest the bottom of the trading range (Apr 9).
  • They see the recent sideways trading range forming a double top bear flag (Jul 14 and Jul 30).
  • They want a second leg sideways to down to retest the June 24 low.
  • They must create strong bear bars trading below the 20-week EMA to increase the odds of the bear leg testing the trading range low.
  • The market remains in a large trading range.
  • Traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction of the trading range with sustained follow-through buying/selling.
  • That means selling in the upper third and buying in the lower third of the trading range.
  • The market is currently trading slightly above the middle of the trading range.
  • The middle of the trading range is a magnet and an area of balance.
  • So far, the market continues to hold above the 20-week EMA. The bears need to do more to show they are in control.
  • For now, traders will see if the bulls can create more follow-through buying.
  • Or will the bears be able to create bear bars trading below the 20-week EMA instead?
  • Poor follow-through and frequent reversals are hallmarks of trading ranges.

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