This is just an idea based on price action around my clones ranges and OPEC agreeing to cut 1.2 MBD - though it seems the market is waiting for bullish reports to validate that this cut will have an impact:
1. Supply has possibly exhausted near the strong November 2016 Rally/Breakout Level
2. Equilibrium between Buyers and Sellers last week may have validated the selling exhaustion
3. So far on increasing volume we have seen Higher Demand
4. Viewing the Descending Supply areas from since mid-November as a 'creek' of Supply that is too strong to cross, if we see a continued increase in volume and price over the next trading week(s), then Supply may be thinning/narrowing and it may be a good time to try and jump the creek.
5. Keep an eye on 52.56, this was a very significant pivot/breakup/breakdown level in 2016 following the end of year OPEC decision to cut production.
THIS I JUST AN IDEA as prices may range 50-55 for months as they did in 2016; but I am seeing the last High Volume Demand level at 51.56-51.86 as a good level to enter Long and/or if prices do 'Jump the Creek' and test 55.12-55.90 validating a bullish breakout; look for a pullback to broken Supply at 53.93 to add/enter Long. If we do see a breakout rally, I see potential re-accumulation up to targets at 59.87 and 62.25 prior to a healthy pullback.
For the Wyckoffians out there, I am viewing Friday's decline as a potential Selling test in Phase B and from here am looking for higher LPS's.
My recommendation here would be to wait for a break up to 55.x and retrace to 53.9-54 for a long entry as with Brexit looming on Tuesday there is definitely potential for a move down. Following the June 2016 Brexit vote, the next daily oil candle dropped over 3 dollars. If prices do breakdown further, I would look for a strong bounce at 48; else, to the upside, look for a daily close above 53.93
I’m loading the boat with house $ as it tags 50 bucks and have room to scale in down to 35 still risk Managed. Technical analysis aside..A 55 gallon drum of water costs more than $50 haha
look4edge
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hey, nice chart, appreciate !!
could happen if crushing supply but this area has long memory, lets see am simply watching 50/540 range, flow is down
all best in your trades
smitheric1970
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@look4edge, Agreed, following the November 2016 OPEC meeting, prices were stuck in a 50-54 range for 3 months heading into March of 2017, same range. Around Feb 20 2017, prices on the Daily tried to close above 53.9 for a few days trying to create higher structure support prior to failng. I think we are in a similar pattern. 53.9-55 zone would need solid footing in order for a potential reversal.
Zoen_Trieste
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Around the same levels
smitheric1970
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@Zoen_Trieste, nice work, hoping we see prices jump up those channels!
Zoen_Trieste
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@smitheric1970, very nice read on wyckoffs’ theory - thanks for sharing.
khansalarehsan
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@Zoen_Trieste, Downward channel should be respected until it is broken the topside imo
Zoen_Trieste
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@khansalarehsan, agree with you there. However, there is some change in market behavior. After 20 or more bars of sideways, the odds of a breakout downwards become 50/50 from 60/40.
smitheric1970
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@khansalarehsan, Indeed and agreed; though channels can be a bit subjective. I have prices breaking the October 31 Supply line but below the October 9 Supply line still. IMO, bulls need for prices to close above the 53.87 Breakdown Bar, likely initially swinging between there and the 55.28 Daily Inflection. This could of course take days or months, but I do see selling exhaustion at the 50.4 level based on equilibrium between buyers and sellers last week and high volume/sideways.
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