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Weekly Crude Oil Bulls Need Strong Follow-through Buying

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Market Overview: Crude Oil Futures

The weekly Crude oil bulls need strong follow-through buying closing far above the 20-week EMA and the bear trendline to show they are taking control. If the market trades higher, bears want the 20-week EMA and the bear trendline to hold as resistance, forming another major lower high.

Crude oil futures

The Weekly crude oil chart

Crude Oil Weekly - Bears Want LH, Bulls Need FT Buying, Weekly Crude Oil Bulls Need Strong Follow-through Buying
  • This week’s Crude Oil candlestick was a bull bar closing in its upper half, with a prominent tail below.
  • Last week, we said traders would watch whether bears could generate more follow-through selling to retest the October low, or whether bulls could form a strong bull entry bar testing the 20-week EMA instead.
  • Bulls managed to produce a decent bull entry bar testing near the 20-week EMA.
  • Bulls view the October 20 selloff as a large two-legged bear leg within a trading range, followed by a higher low major trend reversal (Nov 25).
  • They need consecutive strong bull bars closing far above the 20-week EMA and the bear trendline to show they are taking control.
  • Bears got a second leg sideways to down (Nov 25) retesting the October 20 low from a large wedge bear flag (Jul 30, Sep 26, Oct 24).
  • The move, while persistent, had overlapping ranges — a sign that bears are still not strong.
  • If the market trades higher, bears want the 20-week EMA and the bear trendline to hold as resistance, forming another major lower high.
  • Crude Oil remains in a large trading range.
  • Traders will likely continue to Buy Low, Sell High — buying near the lower third and selling near the upper third — until a clear breakout with sustained follow-through develops.
  • The retest of the October low (Nov 25), despite its persistence, showed overlapping bars, reinforcing that bears are not yet decisively in control.
  • Buyers may appear around the lower third of the trading range.
  • Traders will watch whether bulls can generate additional follow-through buying that closes above the 20-week EMA and tests the Oct 24 high.
  • Or whether the market stalls around the 20-week EMA with sellers appearing above the 6-bar bear microchannel instead?
  • Poor follow-through and frequent reversals remain hallmarks of a trading range environment.

The Daily crude oil chart

Crude Oil Daily - Bulls Need FT, Bears Want Lower High
  • The market traded slightly lower early in the week, then moved sideways to up from mid-week onward, closing above the 20-day EMA.
  • Previously, we said traders would watch whether bears could generate more follow-through selling and break below the October low, or whether the market would stall and retest the October 24 high instead.
  • Bulls see the recent pullback as forming a large High 4 bull flag and want a higher low relative to the October 20 low — which has formed so far.
  • They want a strong leg up breaking far above the 20-day EMA and the bear trendline.
  • Bulls need consecutive strong bull bars trading well above the October 24 high to show they are regaining control.
  • Bears got a retest of the October low that formed a higher low (Nov 25).
  • They see the current move as a small two-legged pullback (Dec 1 and Dec 5) and want it to form a lower high.
  • Bears must produce consecutive strong bear bars breaking far below the 20-day EMA to increase the odds of another strong leg down.
  • The market remains in a large trading range.
  • Traders will continue to Buy Low, Sell High until a clear breakout with sustained follow-through appears — buying near the lower third and selling near the upper third.
  • The retest of the October low (Nov 25) had overlapping ranges, showing bears are not yet decisively strong.
  • Buyers may appear near the lower third of the range.
  • For now, traders will watch whether bulls can generate more follow-through buying, breaking far above the 20-day EMA and the bear trendline to test the October 24 high.
  • Or whether the market forms another lower high and evolves into a larger wedge bear flag (first two legs: Jul 30 and Sep 26) instead.
  • Poor follow-through and frequent reversals continue to define a trading-range environment.

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