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Weekly Crude Oil Follow-through

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Market Overview: Crude Oil Futures

The market formed a weekly Crude Oil follow-through bull bar closing above the 20-week EMA. The bulls must create consecutive bull bars closing near their highs to increase the odds of a breakout above the triangle top. The bears see the recent move as a two-legged pullback (Sep 24 and Oct 4). They want a reversal from a lower high and a double top bear flag (Aug 12 or Aug 26 high with Oct 8).

Crude oil futures

The Weekly crude oil chart

Crude Oil Weekly: FT Bull Bar, No Breakout Yet, Weekly Crude Oil Follow-through
  • This week’s candlestick on the weekly Crude Oil chart was a bull bar with a small body closing above the middle of its range with long tails above and below.
  • Last week, we said the market may still trade at least a little higher. Traders would see if the bulls could create a follow-through bull bar or if the market would form a pullback closing below the 20-week EMA instead.
  • Crude Oil traded higher early in the week followed by a pullback to test the 20-week EMA. The market then reversed to close the week higher.
  • The bulls got a reversal from a double bottom bull flag (Jun 4 and Sept 10 or Dec 13 and Sep 10) and a wedge (Jun 4, Aug 5, and Sep 10).
  • They got a failed breakout below the triangle and a reversal to the middle of the trading range.
  • This week, they got a retest of the triangle high but there was no strong breakout yet.
  • While this week’s bull body was small, it was enough to indicate some follow-through buying.
  • The bulls must create consecutive bull bars closing near their highs to increase the odds of a breakout above the triangle top.
  • Previously, the bears got a breakout below the triangle but lacked follow-through selling.
  • They see the recent move as a two-legged pullback (Sep 24 and Oct 4). They want a reversal from a lower high and a double top bear flag (Aug 12 or Aug 26 high with Oct 8).
  • They want a retest of the September 10 low, even if it forms a higher low.
  • Since this week’s candlestick is a bull bar with a small body and long tails, it is not a good signal bar.
  • The long tails above and below the candlestick also indicate poor follow-through and frequent reversals which is the hallmark of trading range price action.
  • For now, the market may still be in the sideways to up phase.
  • Traders will see if the bulls can create another follow-through bull bar breaking above the triangle top.
  • Or will the market start to stall and form a pullback closing below the 20-week EMA instead?
  • The market is trading around the middle of the large trading range which is an area of balance.
  • 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 ongoing / escalating conflict in the Middle East can keep energy prices volatile.

The Daily crude oil chart

Crude Oil Daily: Test Top of Triangle, LH or Breakout?
  • The market traded higher early in the week but reversed into a big outside bear bar on Tuesday. Wednesday tested the 20-day EMA but closed with a long tail below. Thursday traded higher followed by an inside doji on Friday.
  • Previously, we said that traders would see if the bears could create more follow-through selling to retest the Sep 10 low or if the market would stall at a higher low and form a retest of the September 24 high instead.
  • The market formed a higher low and retested the triangle top.
  • The bears see the current move as a pullback and want a small retest of the prior leg low (Sep 10), even if it forms a higher low.
  • They want a reversal from a double top bear flag (Aug 26 and Oct 8) and hope the top of the triangle will act as resistance.
  • They see Thursday as a pullback and want a second leg sideways to down.
  • The bulls got a reversal from a double bottom bull flag (Jun 4 and Sep 10), a wedge (Jun 4, Aug 5, and Sep 10) and an embedded wedge (Sep 4, Sep 6, and Sep 10).
  • They then got a reversal from a higher low major trend reversal (Oct 1) to retest the top of the triangle but there is no strong breakout yet.
  • The bulls must create consecutive bull bars closing near their highs breaking far above the August high to increase the odds of a breakout above the triangle pattern.
  • So far, the move up from the October 1 low has stronger bull bars than bear bars that lacked follow-through selling (Oct 9).
  • The market may still be in the sideways to up phase.
  • Traders will see if the bulls can create more follow-through buying (probably early next week).
  • Or will the market trade slightly higher but form a double top with the October 8 high instead?
  • Poor follow-through and reversals are hallmarks of a trading range.
  • The market is trading around the middle of the trading range which is an area of balance.
  • Traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction with sustained follow-through buying/selling.
  • The ongoing / escalating conflict in the Middle East can keep energy prices volatile.

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