NYMEX:CL1!   Light Crude Oil Futures
914 58 16
As Oil             is breaking into higher territory, I have gone to an older monthly range as outlined in my 'Oil - Bullish to 68.X ?' chart; this chart will serve to update my daily view. These daily ranges are clones, which are quartered; I have found that these clones of a 45.62-50.27 range that I've published a few times to remain significant; so I look at high volume breaks above or below these levels to help determine my short term direction (profit taking/position adding levels) on what I hope is oil's path to 64.x and possibly 68.x. Typically when prices reach the top of a daily range, in this case 64.62, we will see a significant break based on volume ; hopefully this chart will help illustrate that.

Short term - I will look for prices to test the midpoint of this range at 62.25 and this will be my first target.

Entry: 59.57-59.87
TP1: 62.25 (Additional targets updated on daily basis but note that each line up on the chart is a TP as I initially enter with multiple positions)
SL: 58.9

Here is a view of the Monthly range from 59.73-68.94 that I am looking for a repeat of:

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Please let me know if you have any questions, good trading all!
Comment: First 2 Target Prices: As these targets are hit I will take partial profits and look for pullbacks to re-add long positions.

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Comment: Update on the 2015 'Failed' demand zone. Right panel shows current H4 view of that inflection zone: 59.61-59.77 Bulls are working hard to recreate support here.

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Comment: So far this 59.57-59.87 buying zone is wet paint... Very neutral EIA report today.
Comment: For those of you that complained there were no candles to the left to reference on the published chart, aka @TuanNguyen713; here is a daily chart showing the two clone ranges with earlier reference; those of course won't show on one screen with current time on H4 as they are too far back in time; but there is probably a Tradingview tutorial somewhere for scrolling to the left :) But note; the range I'm looking for is the '05 monthly range explained above, the clone/stagger levels will be used dynamically in trading potential swings on the way up.

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Comment: I used H4 on the published chart as I've found that it best shows price action in relation to these static clones; here is an H4 view of the same chart from the 2014 drop:

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Comment: While we are patiently waiting for prices to break above the buy zone and into the daily range; an IMPORTANT note: Where the 2015 inflection zone failed and sellers took over (59.61-59.77) - sellers are currently getting absorbed, in my opinion, this is VERY important and an early bullish signal:
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Comment: And FINALLY, we have a very nice move above the 2015 inflection, prices could still pullback into it, but for me, as stated above, this is a signal that where sellers overtook buyers at this zone in 2015, sellers are getting absorbed here and I will expect solid support here soon as we are also seeing a strong move above the bottom of the daily range at 59.87.

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Comment: Well so far all is looking good; at some point I will expect validation of the range bottom at 59.87 but am hoping we hit a TP level first so we can get a nice pullback before re-adding some longs. If you watch MA's, I am excited to see how this view plays out, we recently saw a really nice break of the weekly 200 MA and are currently sitting at the 2014/2015 MONTHLY 200 MA break and retest point = The change in the SUPPLY zone on this chart into DEMAND, mid term... I've included my two daily ranges on the chart.
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Comment: Just a reminder on the first two Take Profit levels; with a minor change, the initial profit level was 62.25; small change: TP1: 62.24, TP2: 63.43 and again, at these levels I am taking partial profits and will look for pullbacks and/or support structures to add more long positions.

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Comment: Couple of notes/updates: 1. I've added to the profit/pullback chart, essentially, yes, it's just taking partial profits at each level and adding long positions on pullbacks to each level. 2. The second chart shows a daily inflection at 63.02 form the 2014 leg down, I am curious to see what happens there, if prices breach 62.25, it would not surprise me to see some pullback at that 63.02 inflection...

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Comment: The 2014 Daily /tradingview/snapshots/d/d1wUv2Zg.png#
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Comment: Really no significant updates for the coming week, looking at the same Partial Profit taking levels and buy levels on pullbacks. This may change depending on price structure and volume but for now, if we see a move up to 65.8 within the next couple of weeks, I will likely switch to a short model as I'm assuming we may see strong supply in the 65.78-67 range. So, will switch to a short model at 65.78, with partial Partial Profit taking and re-adding shorts at the same levels as the long model. (ok roughly the same levels, my superstition is buying 1 cent above my levels and selling 1 cent below my levels. Lol) Have a great trading week all!

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Comment: No changes to the plan, other than FINALLY taking partial profit, woohoo!

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Comment: With a solid volume breach of 62.25, the midpoint of the daily range, I now expect prices to test the top of the current daily range at 64.62. Keep in mind we have a daily inflection shown below at 63.02; while it's possible to see a reversal there, we have structure over the past few days and a high volume break up, this gives me hope that a strong EIA could break the 63.02 inflection, creating higher support and helping us get to our 65.8-67 supply level, which also concides with the next high 2014 daily inflection.
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Comment: Small 15 minute timeframe, keeping an eye on volume and that 63.02 Daily Inflection shown above; if we get a neutral to bullish API report and bullish EIA report then I'm hoping we consolidate above and then see support at 63.02:

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Comment: -11.19 crude draw estimated on API, that is big... We've hit our second Partial Profit taking level at 63.43 - no change to the plan; although, stay tuned as we will need to be dynamic if 65.81 hits, it is very possible that I will decide to stay in a long model and continue buying pullbacks, but for now, 65.78-67 is my supply zone as I would be surprised if we did not see a pullback between 65.8 and 65.99.

Good trading all

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Comment: Interested in others views, questions, comments!
Comment: Wow, prices have been on a tear and woohoo, we reached another Partial Profit Level. I will be staggered out of long positions at 65.78 and will enter a Short model if we see it in the coming days BUT AGAIN; this is dynamic and I may choose to remain in a Long model if dictated by price action/volume but will keep updates coming if that happens.

Please NOTE: I've moved the closest Pullback Buy up to 63.74 rather than the quarter mark. No other changes to the plan.

Good trading all!

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Comment: That was a quick exchange today; already bought back additional Longs at 63.74; hopefully prices will stay low through mon if you didn't get a chance to add the longs.

NOTE: If you Re-added Long Positions don't forget to set sells for Partial profit again at 64.61

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Comment: IMPORTANT UPDATE: CHANGE TO SHORT MODEL LEVEL
It has been a fabulous week trading and I have made an important modification to my supply level = My initial SELLING ZONE was 65.78-67.00; part of this is because we have a daily inflection at 65.99 from 2014; however the 4 Hour view shows a strong swing low at 64.62 (current range top) and a strong Demand/Supply Exchange at 67.00. As my long game is to continue running a long model up to 69/70; I've decided that even if 65.8 pulls back, I will just continue with the Pullback Buys and Partial Long Profit taking.

THE NEW SELL/SHORT ZONE is: 66.69-67.00 - If price reaches 66.69 I will have closed out all Long positions and will begin a Short Model intending on switching back to a Long Model again at 64.92.

Below I will show the updated Target chart and the 2014 4 Hour view showing my reason for change in Short Level.

Have a great week all and as usual, I'd appreciate any questions, comments or criticism.

Good trading!

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Comment:
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Comment: One additional note that I 'hope' will become important. It may seem odd that I shaded the levels between the ranges, somewhat of a red/grey bullseye. Well I am hoping that the 64.62 level becomes a median - I would like to see prices run the 59.87-70 level for the first half of '18 and basically swing around the 64.62 median where we would remain in the long model stagger from 61.06 and short model stagger from 68; if that does indeed play out then we may have an opportunity for 2,000 to 4,000 ticks/pips of swings over the next several months. Maybe pie in the sky hopes, but fingers crossed!

Have a great weekend all!
Comment: No Updates heading into the week: Just want to reiterate that the next Partial Profit taking level is 65.78 and I will fully reverse to a short position at 66.69. I will likely be reversing back to a long position between 63.43 and 64.62 (if all of this plays out) so will be shorting three positions to stagger (Partial Profits at levels on the way down and will use the same Add-Short Pullbacks, vice versa to what we did on the way up. A position could be 3 shares, 3 contracts, 100 or any number of shares or contracts that you split into three large positions for each Partial Profit level. The more positions you trade, the more creative you can get with managing risk to reward while staggering. For example, if you were trading 10 shares or contracts, and we are staggering 3 levels, you could short 10 shares/contracts, buy back two at the first level to manage risk in the event that prices go the wrong way, buy back 5 at the next level to ensure you hold on to those golden profits and even better manage risk and then close then last 3 out if/when the third level is reached. If this doesn't make sense or if you'd like to discuss further and or see a chart, let me know.

Good trading week to all!
Comment: One more note: If prices do reach my Sell level at 66.69 by chance this week, it will be a sell at 66.69 on the CLH8 (March futures contract) as this is the last week prior to rollover. Quite a bit of volume started moving into the H contract, this is the last trading week on CLG8 prior to rollover and I the spread is currently less than 10 cents.

Please let me know if you have any questions. If futures front month rolling into back month is new to you, Investopedia is a great resource: https://www.investopedia.com/terms/b/backmonthcontract.asp
Comment: The very first update to this post shows the Monthly range that I based this publish off of which is a 57.32-68.94 monthly range from 2005. Here I've broken that '05 range down into what I feel are significant daily levels and sure enough we have some confluence on current daily action on the way up; Notice the strong 63/63.7-67 range in '05 that I am using as a guide for our current 'near' 67 reversal zone:

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Comment: To illustrate the significance of the significance of the lower yellow box range in '05, take a look at the extended range in 2015 that prices gapped down below - telling me that range is a significant demarcation zone when broken above, or below:
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Comment: So here you can see that If we are repeating a larger older range, the significant levels within the older range may have the same impact on current price action, so bringing those levels to the present, we have have a guide to signal breakdown/breakups in the coming weeks/months:

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Comment: And you'll notice that my 'blank slate' clone levels in the published chart at the top are roughly based on this overall expected movement. If similar to '05 we could possibly see this range play out into mid 2018Hopefully we can successfully ride the waves a bit longer and coast into the shore without wiping out... Lol sorry for the cheesy analogy...
Comment: No changes to the previous targets; however, if prices do break upwards again this week there is potential for large intra-day swings; I do not like to add the 'Pullback Buy" level to the chart, unless the upper 'Partial Profit' level has been reached and I do not always set them right at the levels on the chart. So just a heads up, if prices do reach the $65.78 Partial Profit level, I will be setting the Pullback Buy level at $64.92. And currently not other changes, if futures traders , if 66.69 level is reached on the current contract I will start a short model on the CLH8.

Good trading all!

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Comment: Note: Any concerns with yesterday feeling bearish: while we saw what felt like bearish volume and candles, prices held there ground which tells me that sellers were likely being absorbed again. Please take a look two charts up (the one with the large yellow squares) - whenever prices dipped int to he 63-63.67 zone, they were quickly bought back above it, signaling that we may see similar support in that zone again, mid term as we saw in '05. Another daily close above 64.62 will be a good sign that the 65.78 partial profit level is going to get tested.
Comment: Lots of craziness after hours today - There is no change to the plan. If we get a DAILY CLOSE below 63.00 then I'll re-assess and update. Patience....
Comment: Again, no updates unless we have a DAILY close below 63. For what it's worth, this is the same chart, posted just above and prices have stopped right at the midline of the channel that I have laid out. (I do not put much weight in channels... they are fickle) Nonetheless, the touch on the midline gives me a little bit of hope for a bounce back up into this weeks range.
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I was thinking oil would start the run over 64 today but now it is 63.55 and starting to think maybe we topped out. Hopefully this is just a small pullback before breaking and staying above 64 soon.
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Low 63 now so needs to hold. If it breaks below 63 I think the correction that many predicted will have started so hoping your calls remain correct and buyers step in from these levels.
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smitheric1970 PRO leolithuania
@leolithuania, Yes, a daily close below 63 and we'll have to try and determine next support and managing it; but I'll wait for the daily close; there is quite a bit that could cause volatility this week, I believe options expiry is today, we are completing the rollover cycle this week from February to march contract, BOC interest rate decision today, we are sitting right in that major 63-63.67 zone and the US Dollar seems a volatile, bearish but if the USD finds a bottom and a quick bounce then how will that impact crude? Pins and needles hoping that this range accumulates and does not distribute. The USD and Crude is generally an inverse correlation; although they can move together, I'm hoping that with flat movement on crude following the USD's last drop that maybe we'll get that last press to the updside we are hoping for.

Fingers crossed that crude has a little catching up to do, inversely, against this USD move.

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leolithuania smitheric1970
@smitheric1970, Thanks for this.
Just an example of people calling for a big crude correction to start right now (target $55 roughly) based on charts/indicators and the cot reports, etc: "SI(5) for $OIL is currently the highest since 2012, and I've got to go all the way back to the oil price shock of 1990 to find a point where this level of RSI wasnt quickly followed by at least a mean reversion to the 20 day MA (~$61 now). Fine with the short R/R here"
Hopefully we do not see below 63 before going to the 66s or even higher but we shall know soon enough.
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smitheric1970 PRO leolithuania
@leolithuania, Excellent information, thank you! RSI can be very difficult on larger timeframes, like the weekly. Look at the similarities in the channels from 2005 and current that ran up from the 26 level and the where the RSI seemed to peak at this same level. While there was an initial pullback, Oil diverged another 30 dollars up, after the RSI had peaked.
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leolithuania smitheric1970
@smitheric1970, very good point.
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leolithuania smitheric1970
@smitheric1970, So far so good as we have not collapsed yet which was my fear and even holding around 64. Could be we are on our way to 66s (maybe even higher) as you predicted. Don't want to jinx it so will just keep fingers crossed.
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smitheric1970 PRO leolithuania
@leolithuania, Indeed, I think we will see that 65.8 mark soon...
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Hit 63.39 just pennies below your 63.43 pullback level. Let's see if that was spot on and we go higher now.
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smitheric1970 PRO leolithuania
@leolithuania, while the daily candle looks bearish and had decent volume; but prices didn't drop very much and on smaller timeframes, there is a great deal of volume that seems to be keeping prices above that 63-63.67 zone. Unless we get bearish reports this week then I think there is a good chance of another move up.
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