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Inside Bear Bar on Crude Oil Monthly Chart

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Market Overview: Crude Oil Futures

The market formed an inside bear bar on Crude Oil monthly Chart. If the market trades higher, bears want the 20-month EMA or the bear trendline to act as resistance. Bulls see the current move as a pullback within the trading range and want a reversal from a higher-low major trend reversal (October 20).

Crude oil futures

The Monthly crude oil chart

Crude Oil Monthly - Bear Leg, Higher Low, Bears Need FT, Inside Bear Bar on Crude Oil Monthly Chart
  • The November monthly Crude Oil candlestick was an inside bear bar closing in its lower half with a small tail below.
  • Last month, we said traders would watch whether bears could create follow-through selling below the 20-month EMA, or if bulls could break strongly above the 5-bar bear microchannel instead.
  • The market traded sideways to down for the month, overlapping within October’s range.
  • Bears want a bear leg to retest the trading range low (April 9).
  • While the market has traded lower, it has formed a higher low (Oct 20) with overlapping ranges, indicating the bears are not yet decisively strong.
  • If the market trades higher, bears want the 20-month EMA or the bear trendline to act as resistance.
  • They expect sellers above the 6-bar bear microchannel, followed by at least a small retest of the October low.
  • They need sustained follow-through selling breaking below the October low to increase the odds of testing the trading range low.
  • Bulls see the current move as a pullback within the trading range and want a reversal from a higher-low major trend reversal (October 20).
  • They want the lower third of the trading range to act as support.
  • They will need consecutive bull bars breaking strongly above the 6-bar bear microchannel to show that they are regaining control.
  • The market remains in a trading range.
  • Traders will continue to Buy Low, Sell High (BLSH) — buying near the lower third and selling near the upper third — until a clear breakout with sustained follow-through occurs.
  • The middle of the trading range can be a balance area and a magnet.
  • For now, traders will watch whether bears can create more follow-through selling below the 20-month EMA, or if bulls can break strongly above the 6-bar bear microchannel and close back above the 20-month EMA instead.
  • There could be sellers above the first pullback following the 6-bar bear microchannel.
  • Poor follow-through and frequent reversals are hallmarks of trading ranges.

The Weekly crude oil chart

Crude Oil Weekly - Weak but Persistent Pullback
  • This week’s Crude Oil candlestick was a bull doji closing around the middle of its range with prominent tails.
  • Last week, we said traders would watch whether bears could create more follow-through selling to retest and break below the October low, or if buyers would appear there instead.
  • Bulls see the selloff (Oct 20) as a large two-legged bear leg within the trading range (first leg: Jun 23–Aug 13).
  • They see the current decline as a retest of the October low and want a reversal from a higher-low major trend reversal.
  • They need to create consecutive strong bull bars closing far above the 20-week EMA and the bear trendline to show they are taking control.
  • Bears want a second leg sideways to down to retest the October 20 low — even if it forms a higher low — from a large wedge bear flag (Jul 30, Sep 26, Oct 24). So far, this is the case.
  • They hope for a strong bear leg breaking below the October low to test the lower boundary of the trading range.
  • If the market trades higher, they want the 20-week EMA and the bear trendline to continue acting as resistance.
  • Crude Oil remains in a large trading range.
  • Traders will likely continue to Buy Low, Sell High within the range — buying near the lower third and selling near the upper third — until a clear breakout with sustained follow-through appears.
  • The past five weeks formed a retest of the October low with overlapping bars, indicating the bears are not decisively strong yet.
  • The 6-bar bear microchannel indicates persistent selling for now.
  • The market is trading near the lower third of the trading range, and there could be buyers there.
  • For now, traders will watch whether bears can create more follow-through selling to retest the October low, or whether bulls can create a strong bull entry bar testing the 20-week EMA instead.
  • Poor follow-through and frequent reversals remain hallmarks of a trading range.

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