CL> triggers for either a short or long position.
Hello fellow traders!
I hope you are enjoying my charts and analysis. As you can see from my past analyses and now this CL analysis, I am strictly a trade by patterns kind of person. Wedges, ascending/descending triangles, pennants, flags, diamonds, double/triple tops, head and shoulders carry GREAT POWER especially when combined with support/resistance and supply/demand, (support/resistance is not the same as supply/demand despite debate to the contrary- though they are interlinked). I remember a quote from a ancient Greek philosopher (I think ;)- though I can't recall his name that states "with great power comes great responsibility". What is our responsibility? Always manage risk and reward to near perfection AND always use a stop loss. Some traders may not use a stop loss but I think this is a recipe for disaster. Disaster may not come today or tomorrow or next year or the year after that; but rest assured it will come. All the traders I know who did not use a stop loss did so after striking disaster. Avoid impending disaster by always using a stop loss.
If you enjoy my charts and analysis please support with a follow and a thumbs up. It will make my day- believe me :)
ANALYSIS OF CURRENT CL CHART: (follow the numbers below with the numbers on the chart)
(please see my previous analysis of CL and how closely price has followed my idea, including the big crash the other day)
1. The basic premise of this chart is- Are we in the initial stages of forming a new downward parallel (purple) channel? This would make sense with oil and the upcoming summer.
2. We have been following the yellow parallel channel since October 2020 (Autumn- not a surprise). Now we are possibly forming a new down channel shown here in purple. We are at a critical point here with the bottom line of the yellow channel forming resistance. Price ended Friday right at this resistance. You can mentally form a symmetrical triangle around the current price action. This supports a crossroads because symmetrical triangles can break out in either direction. When 2 factors come together at once it supports your position.
3. You can see the big black wedge that is formed and you can see that price broke out of the inner wedge bounded by the red line and the black line of the black wedge. A wedge within a wedge is another crossroads sign, so now we have another signal that we are at a critical area. Price temporarily broke out of the black wedge but this was a false breakout.
4. A trigger for a long entry will happen if price breaks the black trendline of the black wedge. You may enter on the breakout (aggressive entry) or on a retest of wedge (conservative entry and you could miss the entry).
5. A trigger for a short entry will happen if price breaks below blue support line and becomes resistance. Again you may take a position on the breakdown of support or a retest of what will then be resistance (this is called confirmation). You can see that if price breaks down we still need to get through the demand zone which is weak (this could appropriately be called support at this point). If price breaks below the blue support line and especially if price breaks below the next demand zone, then I would say we have confirmation of a new downtrend within the purple parallel channel.
Those are the 2 scenario's for this week. I do not know which way price will go so I always like to set a short and long trigger. If I had to say, I would say price will go back up because wedges usually take priority. But not always!
If you would like me to do some tutorials on trading with shapes and patterns I would be happy to do so- let me know in the comments. I have a lot of information to dispense about patterns if desired.
One last thing- the only indicator I use is RSI. This is primarily to look for bullish and bearish divergence (regular or hidden). I do pay attention to overbought and oversold but this is secondary as price can remain in these areas for a long time. But if there is bullish or bearish divergence in one of these zones it is a very powerful tool.
Thank you all for listening. I always want everyone to win their trades. I never root for someone to lose money. Even if someone takes the other side from me. The market will decide who wins; not me.
Again you would make my day with a follow and a thumbs up :)
Ms. Bunny
I hope you are enjoying my charts and analysis. As you can see from my past analyses and now this CL analysis, I am strictly a trade by patterns kind of person. Wedges, ascending/descending triangles, pennants, flags, diamonds, double/triple tops, head and shoulders carry GREAT POWER especially when combined with support/resistance and supply/demand, (support/resistance is not the same as supply/demand despite debate to the contrary- though they are interlinked). I remember a quote from a ancient Greek philosopher (I think ;)- though I can't recall his name that states "with great power comes great responsibility". What is our responsibility? Always manage risk and reward to near perfection AND always use a stop loss. Some traders may not use a stop loss but I think this is a recipe for disaster. Disaster may not come today or tomorrow or next year or the year after that; but rest assured it will come. All the traders I know who did not use a stop loss did so after striking disaster. Avoid impending disaster by always using a stop loss.
If you enjoy my charts and analysis please support with a follow and a thumbs up. It will make my day- believe me :)
ANALYSIS OF CURRENT CL CHART: (follow the numbers below with the numbers on the chart)
(please see my previous analysis of CL and how closely price has followed my idea, including the big crash the other day)
1. The basic premise of this chart is- Are we in the initial stages of forming a new downward parallel (purple) channel? This would make sense with oil and the upcoming summer.
2. We have been following the yellow parallel channel since October 2020 (Autumn- not a surprise). Now we are possibly forming a new down channel shown here in purple. We are at a critical point here with the bottom line of the yellow channel forming resistance. Price ended Friday right at this resistance. You can mentally form a symmetrical triangle around the current price action. This supports a crossroads because symmetrical triangles can break out in either direction. When 2 factors come together at once it supports your position.
3. You can see the big black wedge that is formed and you can see that price broke out of the inner wedge bounded by the red line and the black line of the black wedge. A wedge within a wedge is another crossroads sign, so now we have another signal that we are at a critical area. Price temporarily broke out of the black wedge but this was a false breakout.
4. A trigger for a long entry will happen if price breaks the black trendline of the black wedge. You may enter on the breakout (aggressive entry) or on a retest of wedge (conservative entry and you could miss the entry).
5. A trigger for a short entry will happen if price breaks below blue support line and becomes resistance. Again you may take a position on the breakdown of support or a retest of what will then be resistance (this is called confirmation). You can see that if price breaks down we still need to get through the demand zone which is weak (this could appropriately be called support at this point). If price breaks below the blue support line and especially if price breaks below the next demand zone, then I would say we have confirmation of a new downtrend within the purple parallel channel.
Those are the 2 scenario's for this week. I do not know which way price will go so I always like to set a short and long trigger. If I had to say, I would say price will go back up because wedges usually take priority. But not always!
If you would like me to do some tutorials on trading with shapes and patterns I would be happy to do so- let me know in the comments. I have a lot of information to dispense about patterns if desired.
One last thing- the only indicator I use is RSI. This is primarily to look for bullish and bearish divergence (regular or hidden). I do pay attention to overbought and oversold but this is secondary as price can remain in these areas for a long time. But if there is bullish or bearish divergence in one of these zones it is a very powerful tool.
Thank you all for listening. I always want everyone to win their trades. I never root for someone to lose money. Even if someone takes the other side from me. The market will decide who wins; not me.
Again you would make my day with a follow and a thumbs up :)
Ms. Bunny
1. Entry 61.65
Exit 61.23
2. Entry 61.50
Exit ?? (Currently price at 61.05)