Brent Crude Oil Breakout or reversion? A couple of days needed!
Last week was an important milestone to reach the door of a fib retracement level.
Everyone can be interested to catch the uptrend move but it’s important as well to step back on a daily time frame and to consider where we are. On one hand, we are bouncing from the low in the 50 handle which is a significant price increase. On the other hand, we are still in the third section for a full retracement. In other words, do we have a real uptrend or a range market?
Now if we have a closer look to the past in the same price level, 3 daily candles have had a very strong wick on the selling side. The last attempt above the 63 area was followed by a strong downtrend.
Last Friday pullback below 62.50 just after the price reached the 63 level underlines the importance of that area for Sellers that will certainly try to prevent the quotation to pass the 64 price range because it can open the way for a new impulse to the 0.50 Fib level. In addition, potential buyers can also support that pullback to buy it from the low on the next pullback in a first in first out type of tactic. It gives an area of interest from 62.50 to 63.80 to watch carefully in the next couple of days.
If that breakout level is validated, The duration of 50 days for the retracement to go back to 63, gives a very strong potential for the quotation to go much higher beyond the 0.5 to reach potentially 0.618 retracement. For the same reason, we may experience a strong pullback that can lead eventually to a complete reversion.
Everyone can be interested to catch the uptrend move but it’s important as well to step back on a daily time frame and to consider where we are. On one hand, we are bouncing from the low in the 50 handle which is a significant price increase. On the other hand, we are still in the third section for a full retracement. In other words, do we have a real uptrend or a range market?
Now if we have a closer look to the past in the same price level, 3 daily candles have had a very strong wick on the selling side. The last attempt above the 63 area was followed by a strong downtrend.
Last Friday pullback below 62.50 just after the price reached the 63 level underlines the importance of that area for Sellers that will certainly try to prevent the quotation to pass the 64 price range because it can open the way for a new impulse to the 0.50 Fib level. In addition, potential buyers can also support that pullback to buy it from the low on the next pullback in a first in first out type of tactic. It gives an area of interest from 62.50 to 63.80 to watch carefully in the next couple of days.
If that breakout level is validated, The duration of 50 days for the retracement to go back to 63, gives a very strong potential for the quotation to go much higher beyond the 0.5 to reach potentially 0.618 retracement. For the same reason, we may experience a strong pullback that can lead eventually to a complete reversion.
Comment:
You can now experience the strength of the battle zone nearly at the top of my area of interest with a drop of 120 pips from the 63.7x higher high. I will give the next post zooming in on the price action in 3 minutes time frame
Comment:
170 pips wow it's really a good idea to give some explanations ;)