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Crude Oil Bull Microchannel

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Market Overview: Crude Oil Futures

The market formed a 6-bar Crude Oil Bull Microchannel on the weekly chart. It is a strong bull leg which increases the odds of buyers below the first pullback. The bulls want a breakout above the trading range high (April high). The bears want the market to stall around the trading range high. Traders will BLSH (Buy Low, Sell High) in trading ranges until there is a strong breakout from either direction with follow-through buying/selling.

Crude oil futures

The Monthly crude oil chart

Crude Oil Monthly: July Bull Bar Above Bear TL & 20-EMA
  • The July monthly Crude Oil candlestick was a big bull bar closing near its high.
  • Last month, we said that the market remains in a trading range and traders will BLSH (Buy Low, Sell High) in trading ranges until there is a strong breakout from either direction with follow-through buying/selling.
  • The bulls got a reversal up from a wedge bottom (Dec 9, Mar 20, and May 4) and a double bottom (Mar 20 and May 4).
  • They got a breakout above the June bull inside bar and close above the 20-month exponential moving average and bear trend line.
  • They will need to create a follow-through bull bar in August to increase the odds of a breakout above the 8-month trading range.
  • The bears hope to get a reversal down from around the trading range high (April high) area.
  • They hope that the current move up is simply a bull leg within the 8-month trading range.
  • If the market trades higher, they want a failed breakout from above the trading range.
  • Since July was a bull bar closing near its high, odds are August will trade at least a little higher, which it has done.
  • Traders will see if the bulls can create a follow-through bull bar or will the market trade slightly higher but stall around the trading range high area.
  • Traders will BLSH (Buy Low, Sell High) in trading ranges until there is a strong breakout from either direction with follow-through buying/selling.

The Weekly crude oil chart

Crude Oil Weekly: 6-Bar Bull MC, Retest TR High Crude Oil Bull Microchannel
  • This week’s candlestick on the weekly Crude Oil chart was a bull bar closing near its high.
  • Last week, we said that the odds slightly favor the market to trade at least a little higher.
  • The bulls got a reversal from a higher low major trend reversal (June 12) and a micro wedge (May 31, Jun 12, and June 28).
  • They also got follow-through buying trading above the 20-week exponential moving average and the bear trend line which increase the odds of a retest of the trading range high (April high).
  • They want a retest followed by a breakout above the trading range high.
  • The move up is in a 6-bar bull microchannel which means persistent buying. That increases the odds that the first pullback will be minor.
  • The bears want a reversal down from around the trading range high area.
  • They hope that the current move up is simply a buy vacuum within a trading range.
  • This week’s bull bar closing near its high is not a strong sell signal bar. It is a buy signal bar.
  • The bears will need a strong sell signal bar or at least a micro double top before they would be willing to sell more aggressively.
  • While the current move up is strong, it could still only be a bull leg within a trading range.
  • The market is in a 37-week trading range. Traders will BLSH (Buy Low, Sell High) in trading ranges until there is a strong breakout from either direction with follow-through buying/selling.
  • For now, odds slightly favor the market to trade at least a little higher.
  • Traders will see if the bulls can continue to create follow-through buying or will next week trade slightly higher but stall around the 37-week trading range high area.

Market analysis reports archive

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