Market Overview: Crude Oil Futures
The weekly chart formed a Crude Oil strong bull leg in the form of a 5-bar bull microchannel. The bulls want a retest and breakout above the trading range high (April high). The bears want the market to stall around the trading range high area and reverse lower.
Crude oil futures
The Weekly crude oil chart
- This week’s candlestick on the weekly Crude Oil chart was a bull bar closing near its high.
- Last week, we said that traders will see if the bulls can continue to create follow-through buying or will next week trade slightly higher but close with a long tail above or a bear body.
- 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.
- The move up is in a 5-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.
- 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 before they would be willing to sell more aggressively.
- They hope that the current move up is simply a buy vacuum within a trading range.
- While the current move up is strong, it could still only be a bull leg within a trading range.
- The market is in a 36-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 36-week trading range high area.
The Daily crude oil chart
- Crude Oil traded sideways to up for the week. Wednesday formed an inside bear bar but there was no follow-through selling.
- Last week, we said that traders will see if the bulls can continue to create follow-through buying or will the market stall and trade back into the previous tight trading range.
- The move up since June 28 is in a tight bull channel with not much-sustained follow-through selling.
- The bears hope that the tight channel up is simply a buy vacuum within the trading range.
- They want the market to reverse lower from around the 36-week trading range high.
- They will need to create consecutive bear bars closing near their lows to increase the odds of a reversal down.
- The bulls got a reversal up from a wedge bull flag (May 31, Jun 12, and June 28) and a higher low major trend reversal.
- They then got a second leg sideways to up trading near the 36-week trading range high.
- The move-up is in a tight bull channel. That means persistent buying.
- Odds slightly favor at least a small retest of the current leg extreme (now July 28) after a pullback.
- The next target for the bulls is the April high.
- Because of the strong leg up with bear bars not getting much follow-through selling, odds slightly favor the market to still be in the sideways to up phase.
- Crude Oil has been trading within a 36-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, traders will see if the bulls can continue to create follow-through buying or will the market trade slightly higher but stall around the trading range high area.
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