Curso de Trading de Brooks

Aprenda a operar con la acción del precio de forma consistente

 

More results...

Weekly Crude Oil Big Outside Bull Bar

By

Market Overview: Crude Oil Futures

The market formed a weekly Crude Oil big outside bull bar closing above the 20-week EMA. The bulls want a retest of the triangle high and a strong breakout above. They 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 4).

Crude oil futures

The Monthly crude oil chart

Crude Oil Monthly: No FT Selling, Middle of Trading Range
  • The September monthly Crude Oil candlestick was a bear bar closing slightly below the middle of its range with a long tail below.
  • Last month, we said that traders would see if the bears could create another follow-through bear bar, closing below the 20-month EMA and breaking below the triangle or if the market would continue to stall around the 20-month EMA area.
  • The market broke below the triangle in September but lacked follow-through selling.
  • Previously, the bears got a reversal from a lower high major trend reversal (Jul vs Apr), a wedge bear flag (Sep 28, Apr 12, and Jul 5), and a double top bear flag (Apr 12 and Jul 5).
  • The prominent tail below the recent candlesticks indicates that the bears are not yet as strong as they hoped to be.
  • They see the current move as a pullback and want the market to stall at a lower high around the bear trend line area.
  • They want a reversal from a wedge bear flag with the first two legs being April 12 and July 5 highs.
  • The bulls hope the recent sideways-to-down move (to Sep 10) is simply a two-legged pullback.
  • They want a reversal from a double bottom bull flag (Jun 4 and Sep 10) and a higher low. They also see a larger double bottom bull flag (Dec 13 and Sep 10).
  • They want a retest of the triangle high and a strong breakout above.
  • So far, October has traded sharply higher.
  • Traders will see if the bulls can create a strong bull bar closing above the 20-month EMA and testing the top of the triangle.
  • Or will the market trade higher (as it has now) but stall and close the month with a long tail or a bear body below the 20-month EMA instead?
  • The increasingly tight triangle pattern indicates that Crude Oil is in a breakout mode.
  • Because the market is also in a trading range (sideways overlapping candlesticks), traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction with sustained follow-through buying/selling.
  • The market trades around the 20-month EMA, the middle of the large trading range. It is an area of balance.
  • The broadening conflict in the Middle East will keep energy prices volatile.

The Weekly crude oil chart

Crude Oil Weekly: Big Outside Bull Bar, Bulls Need FT, Weekly Crude Oil Big Outside Bull Bar
  • This week’s candlestick on the weekly Crude Oil chart was a big outside bull bar closing in its upper half with a small tail above.
  • Last week, we said that traders would see if the bears can create a follow-through bear bar or if the market would form a second leg sideways to up instead.
  • The market traded lower early in the week but reversed sharply higher after.
  • The bulls got a reversal from a double bottom bull flag (Jun 4 and Sept 10 or Dec 13 and Sep 10) or a wedge (Jun 4, Aug 5, and Sep 10).
  • They want a failed breakout below the triangle and the market to reverse to the middle of the trading range. They got what they wanted.
  • Next, the bulls want a retest of the triangle high and a strong breakout above.
  • They must create consecutive bull bars closing near their highs to increase the odds of a breakout above the triangle top.
  • If the market forms a pullback, they want another leg up completing the wedge with the first two legs being September 24 and October 4 highs.
  • Previously, the bears got a reversal from a double top bear flag (Aug 12 and Aug 26).
  • They 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 4).
  • They want a retest of the September 10 low, even if it forms a higher low.
  • Since this week’s candlestick is a big bull bar closing in its upper half, it is a buy signal bar for next week.
  • The market may still trade at least a little higher.
  • For now, traders will see if the bulls can create a follow-through bull bar following this week’s close above the 20-week EMA. If they do, that will increase the odds of a retest of the July or August high.
  • Or will the market form a pullback closing below the 20-week EMA instead?
  • Sometimes, the candlestick following an outside bar is an inside bar or has a lot of overlapping price action.
  • 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 market is trading around the middle of the large trading range which is an area of balance.
  • The ongoing / escalating conflict in the Middle East can keep energy prices volatile.

Market analysis reports archive

You can access all weekend reports on the Market Analysis page.

>