Alright first off price is in bullish Daily trend but it reached 161% of Fibonacci extension ratio and as a result of that we saw a bearish engulfing candle which tells us participants who were long in oil are probably busy with profit taking actions and as a result it is possible that we see a bearish corrective move.
If you are with me so far now lets see how we can trade oil in short time.
In 4H time frame we saw an impulsive bearish move which shifted the 4H time frame structure to bearish for the first time in long time, after that bearish impulsive move we have a bullish corrective move which you can see in 1H time frame. Now price has reached an important res area with RSI indicator divergence and also we can see 1H bearish engulfing candle which shows us price has an intention for down side move also we kind of see that in 1H time frame price also couldn't create HH and we can see a Double top formation which is another confluence for bearish move.
Now in case of trading you can probably wait for the price to come below double top neckline which is around 82.050 and then wait for the retest or you can trade it with your strategy at any given time. But it is important to remember this is a counter trend trading and the overall trend is bullish.
For targeting first target obviously would be around 80.500 and after that its kind of risky to hold the position because as I said its against the main trend.
Wish you all the best
If you are with me so far now lets see how we can trade oil in short time.
In 4H time frame we saw an impulsive bearish move which shifted the 4H time frame structure to bearish for the first time in long time, after that bearish impulsive move we have a bullish corrective move which you can see in 1H time frame. Now price has reached an important res area with RSI indicator divergence and also we can see 1H bearish engulfing candle which shows us price has an intention for down side move also we kind of see that in 1H time frame price also couldn't create HH and we can see a Double top formation which is another confluence for bearish move.
Now in case of trading you can probably wait for the price to come below double top neckline which is around 82.050 and then wait for the retest or you can trade it with your strategy at any given time. But it is important to remember this is a counter trend trading and the overall trend is bullish.
For targeting first target obviously would be around 80.500 and after that its kind of risky to hold the position because as I said its against the main trend.
Wish you all the best
Trade closed: target reached:
well price fell nicely and I closed the position on 80.72 as I said the target would be around 80.50 and price managed to come close to that target but as we knew we were against the main trend and any bullish shifting momentum could give us enough reason to protect our trade and our profit