Market Overview: Crude Oil Futures
The market formed a weekly Crude Oil breakout above the triangle pattern. The bulls want a measured move based on the height of the tight trading range which will take them to the July high area. The bears want a reversal from a double top bear flag (Oct 8 and Jan 10). They want the October or July highs to act as resistance.
Crude oil futures
The Weekly crude oil chart
- This week’s candlestick on the weekly Crude Oil chart was a consecutive bull bar closing in its upper half with a prominent tail above.
- Last week, we said that the odds slightly favor the market trade at least a little higher towards the October 8 high area. Traders would see if the bulls could create sustained follow-through buying over the next few weeks or if the market would trade slightly higher but stall around the October 8 high area instead.
- The market traded higher and tested the October 8 high this week.
- The bulls got a breakout above the top of the triangle this week.
- They want a measured move based on the height of the tight trading range which will take them to the July high area.
- They need to create a follow-through bull bar following this week’s breakout above the triangle to increase the odds of a retest of the trading range high.
- The bears want a reversal from a double top bear flag (Oct 8 and Jan 10).
- They want the October or July highs to act as resistance.
- They see the current move as a bull leg within a trading range.
- They want a retest of the middle of the trading range (around the 20-week EMA area).
- For now, the market may still be in the sideways to up phase.
- Traders will see if the bulls can create sustained follow-through buying over the next few weeks.
- Or will the market trade slightly higher but stall around the October or July highs area instead?
- The market remains in a large trading range. Odds favor the current move to be a bull leg within the trading range.
- Traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction with sustained follow-through buying/selling.
The Daily crude oil chart
- The market traded sideways for most of the week forming a small bull flag. Friday broke higher testing the October 8 high.
- Previously, we said that the traders would see if the bulls could break above the tight trading range with follow-through buying or if the market would continue to chop sideways and test the bottom of the tight trading range instead. Traders will wait for a strong breakout and trade in the direction of the breakout.
- The bulls got a strong breakout above the tight trading range to retest the October 8 high.
- They want a measured move based on the height of the tight trading range which will take them to the July high area.
- They got a breakout above the triangle pattern this week.
- The bulls must continue creating follow-through buying to increase the odds of testing the top of the trading range.
- The bears want the market to reverse and retest the middle of the trading range from a double top bear flag (Oct 8 and Jan 10).
- They want the October or July high to act as resistance.
- They see the current move as a bull leg within a trading range.
- They need to create strong bear bars to show that they are back in control.
- So far, the buying pressure since the breakout from the tight trading range is stronger (consecutive bull bars, big bull bars) than the selling pressure (bear bars with no follow-through selling).
- The market may still trade at least a little higher.
- Traders will see if the bulls can create follow-through buying testing the July high area.
- Or will the market stall around the October 8 high area instead?
- For now, odds favor the current move to be a bull leg within a trading range.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
