Currently, Crude Oil is forming a descending triangle on the weekly timeframe, with significant support at the 0.5 Fibonacci retracement level. This level is a critical point; a break below it could signal further bearish momentum. Should this support level fail, I expect the price to target the next Fibonacci levels at 0.618 and potentially down to 0.786, indicating possible continuation of the downward trend.
I will monitor for confirmation signals of a breakout to the downside, such as increasing volume or bearish candlestick patterns, before confirming a short position. However, if support holds, the triangle could consolidate further, so I will remain cautious for potential reversal signs.
My Approach
1. Weekly timeframe as a guiding framework
2. Daily for pattern confirmation
2.1. Bearish Candlestick formation below support (like a bearish engulfing or strong red candle).
2.2. Rejection candles near the descending upper resistance line (like doji or shooting star).
2.3. Increase in volume on a breakdown below support to confirm seller commitment.
2.4. Decreasing volume within the triangle as consolidation continues.
2.5. Spike in volume on a failed breakout could indicate a false move and potential reversal.
3. 4-Hour for entry
I will monitor for confirmation signals of a breakout to the downside, such as increasing volume or bearish candlestick patterns, before confirming a short position. However, if support holds, the triangle could consolidate further, so I will remain cautious for potential reversal signs.
My Approach
1. Weekly timeframe as a guiding framework
2. Daily for pattern confirmation
2.1. Bearish Candlestick formation below support (like a bearish engulfing or strong red candle).
2.2. Rejection candles near the descending upper resistance line (like doji or shooting star).
2.3. Increase in volume on a breakdown below support to confirm seller commitment.
2.4. Decreasing volume within the triangle as consolidation continues.
2.5. Spike in volume on a failed breakout could indicate a false move and potential reversal.
3. 4-Hour for entry
Note
I am sharing my thought process on these market moves and adjust my analysis as the market evolves. This is not meant to be followed by others, as I am prone to mistakes like anyone else. Instead, I welcome feedback that can help me question and refine my analysis.
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.
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.