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Weekly Crude Oil Bull Entry Bar

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Market Overview: Crude Oil Futures

The market formed a weekly Crude Oil bull entry bar on the weekly chart. The bulls need to create a follow-through bull bar to increase the odds of testing the middle of the trading range. The bears want a reversal from a double top bear flag (with the first leg being either Aug 12 or Aug 26 high).

Crude oil futures

The Weekly crude oil chart

Crude Oil Weekly: Pullback to 20-Week EMA, Bulls Need FT, Weekly Crude Oil Bull Entry Bar
  • This week’s candlestick on the weekly Crude Oil chart was a bull bar closing near its high.
  • Last week, we said that traders would see if the bulls can create a strong entry bar. If they do, that will increase the odds of a retest of the 20-week EMA. Or will the market trade slightly higher, but stall and reverse to close with a long tail or a bear body instead?
  • The bulls managed to create a strong bull entry bar this week.
  • They want a reversal from a double bottom bull flag (Jun 4 and Sept 10) or a wedge (Jun 4, Aug 5, and Sep 10).
  • They see the current move as a large two-legged move (Jun 4 and Sept 10) within a trading range.
  • They want a failed breakout below the triangle and the market to reverse to the middle of the trading range.
  • They need to create a follow-through bull bar to increase the odds of testing the middle of the trading range.
  • Previously, the bears got a reversal from a double top bear flag (Aug 12 and Aug 26).
  • They got a strong breakout below the triangle but lacked follow-through selling. The bears were not yet as strong as they hoped to be.
  • They see the current move as a pullback and want a reversal from another lower high (probably around the 20-week EMA) followed by another leg down completing the wedge pattern (with the first two legs being Aug 5 and Sep 10).
  • They want a reversal from a double top bear flag (with the first leg being either Aug 12 or Aug 26 high).
  • Since this week’s candlestick is a bull bar closing near its high, it is a buy signal bar for next week.
  • Odds slightly favor the market to trade at least a little higher.
  • Traders will see if the bulls can create a follow-through bull bar. If they do, that will increase the odds of a retest of the 20-week EMA or the middle of the trading range.
  • Or will the market trade slightly higher, but stall and close with a long tail or a bear body instead?
  • Poor follow-through and reversals are hallmarks of a trading range.
  • The market is in a large trading range (Trading range high: September 29, Trading range low: May 4).
  • 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

Crude Oil Daily: Pullback, Tight Bull Channel, Wedge
  • The market traded sideways to up for the week, trading above the 20-day EMA.
  • Last week, we said that traders would see if the bears can create a strong retest of the September 10 low followed by another leg down or if the market would trade slightly lower (perhaps early in the week) but stall and reverse higher instead.
  • Previously, the bears got a breakout below the triangle pattern with follow-through selling.
  • They see the current move as a pullback and want at least a small second leg sideways to down to retest the prior leg low (Sep 10), even if it forms a higher low.
  • They see a wedge forming in the pullback (Sep 12, Sep 17, and Sep 19). However, because of the strong 9-bar bull micro channel, the first pullback may only be minor.
  • They want the 20-day EMA or the bear trend line to act as resistance.
  • The bulls want a failed breakout from the triangle pattern.
  • They see the previous move as a large two-legged bear leg (Jun 4 and Sep 10).
  • They got a reversal from a double bottom bull flag (Jun 4 and Sep 10) or a wedge (Jun 4, Aug 5, and Sep 10). They also see an embedded wedge (Sep 4, Sep 6, and Sep 10).
  • The bulls must create consecutive bull bars closing near their highs and trading far above the 20-day EMA to increase the odds of a reversal.
  • So far, the move from the September 10 low is in a tight bull channel in the form of a 9-bar bull micro channel. That means persistent buying.
  • Odds slightly favor buyers below the first pullback.
  • Traders will see if the bulls can continue to create follow-through buying trading above the 20-day EMA to retest the middle of the trading range.
  • Or will the market trade slightly higher but stall around the bear trend line area?
  • Traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction with sustained follow-through buying/selling.
  • Poor follow-through and reversals are hallmarks of a trading range.

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