Oil has been in an uptrend since the massive drop back in April (the price went negative for a future expiry!).
Although the price has filled the March's gap around 41$ and the macro trend looks exhausted based on the divergence on the higher time frame indicators, on the short term time frames it looks like the price has made a higher low by creating a pattern which just got activated by a break above the double bottoms neckline at 39.20$.The target of the pattern is around 41.5$ which is the previous high as well.
The first trouble area between the price and the target is around 40$. The level has acted as a few times previously and it's at the equilibrium of the range as well. The level can be a good price to take some profit of the trade if it goes up.
A pullback to 39.5$ - 39$ can be a good long entry. The price can reach the pattern's target as long as it holds the 39$ level as support, so it can be a good price level to manage the risk of this trade idea below it and exit the trade if the price breaches below it.
This trade idea has 2.5 rewards to risk ratio if it hits the target.
Good luck trading. :)
it failed to gain support above 39$ and got rejected below the level.
However, it has gone according to the plan hit the first target and on its ways to the 2nd target as far as it doesn't break below 39.5$
I think its gonna hit our target in few 1 or 2 days.