USOIL - Short or Buy? Break down or retracement up?
Updated
Technicals
1. We have been stuck in a range on a higher time frame for quite some time now.
2. On a higher time frame we failed to confirm a break-up from a trendline dating back to March 2022, which was the COVID-19 highs. A failed break-up of this mega trendline is normally a sign of big reversal or retracement. & we did just that ;-) question is, is this a reversal or just a retracement because I see also a trendline from DEC 2023 which we trade just under. IMO we have not fully confirmed that break down.
3. Visible in my chart we see that we are since then on a big down sloping channel which is still respected.
Fundamentals
1. My bias is slightly bearish long term because I think the US economy & other major economies will be in a recession which will give downside pressure on the price of OIL
2. Conflict in the Middle East seems to have not a significant impact as of now on the price of USOIL. Will this change? Till I see major escalation happening I don't see that it will have greater impact than it already has. US also is less energy dependent so therefor geopolitical will impact less.
3. Bullish sign is that OPEC is still holding strong on OIL cuts and China is still strong. Summer season will also give some upside pressure because of demand.
Trade
1. The first trade, which is a buy option, I will take if I see buyers really taking over to push price up
2. The second trade, which is a sell, I will take if we confirm a break and retest of the weekly low.
Great trading all of you
Greetingz,
Simba Trades
1. We have been stuck in a range on a higher time frame for quite some time now.
2. On a higher time frame we failed to confirm a break-up from a trendline dating back to March 2022, which was the COVID-19 highs. A failed break-up of this mega trendline is normally a sign of big reversal or retracement. & we did just that ;-) question is, is this a reversal or just a retracement because I see also a trendline from DEC 2023 which we trade just under. IMO we have not fully confirmed that break down.
3. Visible in my chart we see that we are since then on a big down sloping channel which is still respected.
Fundamentals
1. My bias is slightly bearish long term because I think the US economy & other major economies will be in a recession which will give downside pressure on the price of OIL
2. Conflict in the Middle East seems to have not a significant impact as of now on the price of USOIL. Will this change? Till I see major escalation happening I don't see that it will have greater impact than it already has. US also is less energy dependent so therefor geopolitical will impact less.
3. Bullish sign is that OPEC is still holding strong on OIL cuts and China is still strong. Summer season will also give some upside pressure because of demand.
Trade
1. The first trade, which is a buy option, I will take if I see buyers really taking over to push price up
2. The second trade, which is a sell, I will take if we confirm a break and retest of the weekly low.
Great trading all of you
Greetingz,
Simba Trades
Note
Seems like scenario 1 is playing out. Waiting for a pullback to long it. First TP: 79,54
Second TP: 80,94 (around)
Runner: Trailing up.
Stoploss: 76,45
Note
Still not entered a trade. Considering the engulfing hourly candles. This is why we need to wait for a pullback and evaluate if trade still valid. As of now I am sitting on the fences and waiting how the day close. Lets see if tomorrow there will be a buying opportunity or a sellNote
Scenario 1 failed. Glad we didn't take the trade and kept being disciplined after those bearish candles yesterday. Waiting for a support somewhere in the zone where scenario 2 bounce may play out.Note
Scenario 2 has played out perfectly! There may be a long opportunity depending on how we close today! For scalpers there are endless short opportunities in the markets 20 pips at a time.Note
We got an OPEC meeting last weekend where the markets have reacted to. The markets have chosen a direction and that's clearly down. Glad we took a conservative approach when longing the market as previous scenario stated from which we took a W.I'm looking at targets now on these zones.
Note
We have bounced perfectly from the zone as you can see from the charts from my previous comment! Long traders are great in the money right now! 
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.