#202437 - priceactiontds - weekly update - wti crude oil futures
Good Evening and I hope you are well.
tl;dr
wti crude oil: Very strong breakout below previous support around 70 and market is on it’s way to test the 2024 low 64.46. Oil has not traded below 63 for more than a year. Bulls are in pain but some pullback is expected next week.
Quote from last week:
comment: Bears did surprise me big time on Monday where they closed below the August low but the bigger surprise was the follow through on Tuesday where they closed below 70. That was the lowest close for 8 months and bears just sold it relentlessly on every small rip. We are now 4% away from the January low and given the strong selling on much higher volume, we will likely test below 65$ next week. All pullbacks last week were mostly sideways and every time market got near or touched the 4h 20ema, it sold off big time. Any pullback the bulls get, bears will probably continue and try to keep 70 resistance. Selling 67.67 is probably not a good idea so I what for Monday and if we can get near the 4h ema again and there I’d look for weakness.
current market cycle: bear trend
key levels: 60-72
bull case: Bulls are really trying if you look at the 1h chart but every rip bigger than 100 ticks is sold heavily by huge bear bars. Right now at 67.67 I don’t think we are at a bigger support level where bulls want to fight this. Could happen on Monday but I think many more bulls wait for 65 to be hit before longing this. First objective for the bulls is to make the market go sideways and then get a 4h bar close above the ema. Anything above 71 would surprise me.
Invalidation is below 67.
bear case: Bears broke strongly below very big previous support and trying to test the 2024 at 64.46. They are in total control of the market until bulls can close a bull bar above the 4h ema. So we have a clear target with 65 or even 64.46 and a clear invalidation level of the max bearishness with the 4h ema.
Invalidation is above 70.32
outlook last week:
→ Last Sunday we traded 73.55 and now we are at 67.67. Clear levels given, hope you took shorts below 73.
short term: Full bear mode but a pullback is expected. Good r:r shorts are to be found around 69-70. Above 70.32 we will see a more complex pullback and I’d be out of shorts and wait.
medium-long term: Bears broke below multi month support and want a retest of 64.46 or lower. Right now the selling is a bit too steep to be sustainable. When we get a more complex pullback and form a decent channel, I will write a longer update here. Can this bear trend be the start of a bigger where we see Oil below 50$ again? I have absolutely no idea but the current daily chart can not not lead to that conclusion.
current swing trade: None
chart update: Added currently valid bear trend lines
tl;dr
wti crude oil: Very strong breakout below previous support around 70 and market is on it’s way to test the 2024 low 64.46. Oil has not traded below 63 for more than a year. Bulls are in pain but some pullback is expected next week.
Quote from last week:
comment:Not much changed. On the weekly it looks more bearish than it is. Until one side get’s a daily close above or below previous lows/highs, market continues to contract and the breakout is near. Weekly ema is flat as can be. Either scalp to both sides or wait for the breakout. Bears want to get below 70 and bulls want 78 and higher. Odds favor the bulls around 72 to trade back up to at least 76.
comment: Bears did surprise me big time on Monday where they closed below the August low but the bigger surprise was the follow through on Tuesday where they closed below 70. That was the lowest close for 8 months and bears just sold it relentlessly on every small rip. We are now 4% away from the January low and given the strong selling on much higher volume, we will likely test below 65$ next week. All pullbacks last week were mostly sideways and every time market got near or touched the 4h 20ema, it sold off big time. Any pullback the bulls get, bears will probably continue and try to keep 70 resistance. Selling 67.67 is probably not a good idea so I what for Monday and if we can get near the 4h ema again and there I’d look for weakness.
current market cycle: bear trend
key levels: 60-72
bull case: Bulls are really trying if you look at the 1h chart but every rip bigger than 100 ticks is sold heavily by huge bear bars. Right now at 67.67 I don’t think we are at a bigger support level where bulls want to fight this. Could happen on Monday but I think many more bulls wait for 65 to be hit before longing this. First objective for the bulls is to make the market go sideways and then get a 4h bar close above the ema. Anything above 71 would surprise me.
Invalidation is below 67.
bear case: Bears broke strongly below very big previous support and trying to test the 2024 at 64.46. They are in total control of the market until bulls can close a bull bar above the 4h ema. So we have a clear target with 65 or even 64.46 and a clear invalidation level of the max bearishness with the 4h ema.
Invalidation is above 70.32
outlook last week:
short term: Bullish above 75, bearish below 73. Bulls want 77 and bears want 72 or lower.
→ Last Sunday we traded 73.55 and now we are at 67.67. Clear levels given, hope you took shorts below 73.
short term: Full bear mode but a pullback is expected. Good r:r shorts are to be found around 69-70. Above 70.32 we will see a more complex pullback and I’d be out of shorts and wait.
medium-long term: Bears broke below multi month support and want a retest of 64.46 or lower. Right now the selling is a bit too steep to be sustainable. When we get a more complex pullback and form a decent channel, I will write a longer update here. Can this bear trend be the start of a bigger where we see Oil below 50$ again? I have absolutely no idea but the current daily chart can not not lead to that conclusion.
current swing trade: None
chart update: Added currently valid bear trend lines
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