Market Overview: Crude Oil Futures
The market formed a monthly Crude oil breakout below the ii (inside-inside) and triangle patterns in June. Bears want a retest of the 20-month EMA and the breakout point (February 27). Bulls want the 20-month EMA or the March 2 low to act as support.
Crude oil futures
The Monthly crude oil chart
- June formed a big bear bar closing near its low.
- Last month, we said traders would watch whether bears could generate a strong bear entry bar in June, or whether the market would trade lower but stall around the April 17 low area and reverse up, closing with a long lower tail instead.
- Bears got a strong breakout below the ii (inside-inside) and triangle patterns in June.
- Bears want a retest of the 20-month EMA and the breakout point (February 27).
- They need to create strong follow-through selling, breaking decisively below the 20-month EMA, to increase the odds of a reversal.
- Bulls see the current move as a sell vacuum test of the 20-month EMA and the low of the 4-month trading range.
- Bulls want the 20-month EMA or the March 2 low to act as support and hope there are buyers around the low of the 4-month trading range.
- Bulls need consecutive strong bull bars to demonstrate control.
- The market broke out below the ii (inside-inside) and triangle patterns in June.
- While the move down is strong, it could be a bear leg within a trading range.
- The market could still trade slightly lower to test near the 20-month EMA.
- A strong bull leg (March) followed by a strong bear leg indicates trading range price action.
- For now, traders will watch whether bears can generate strong follow-through selling, breaking decisively below the 20-month EMA.
- Or whether the market trades lower but stalls around the 20-month EMA, closing with a long lower tail instead.
The Weekly crude oil chart
- This week formed a small bear doji closing around the middle of its range with a small tail below, testing the March 10 low.
- Last week, we said traders would watch whether bears could generate additional follow-through bear bars breaking below the March 10 low to test the June 23 breakout point, or whether the market would stall around the March 10 low area, followed by a pullback to test the 20-week EMA in the weeks ahead.
- Bulls see the current move as a sell vacuum bear leg testing the low of the 17-week trading range (March 10).
- Bulls want the low of the trading range to act as support.
- If the market trades lower, bulls want the March 2 low area to provide support.
- Bulls need consecutive bull bars closing near their highs to demonstrate control.
- Bears generated a strong bear leg testing the low of the 17-week trading range (March 10).
- The move down is in a tight bear channel, indicating persistent selling.
- The next targets for the bears are the March 2 low and the February 27 breakout point of the rally.
- If the market trades higher, bears want the pullback to be weak, with overlapping candlesticks and prominent upper tails.
- Bears want the pullback to form a lower high, followed by a larger second leg sideways to down.
- Bears want the 20-week EMA to act as resistance.
- Bears need additional follow-through selling to increase the odds of a sustained move lower.
- The move down from the May 18 high is in a tight bear channel, indicating strong bears.
- There may be sellers above the first pullback from the tight bear channel.
- The market is likely Always In Short.
- Traders will watch whether bears can generate additional follow-through bear bars breaking decisively below the March 10 low.
- Or will the market stall around the March 10 or March 2 low area, followed by a pullback to test the 20-week EMA in the weeks ahead?
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
