Oil - Overall Analysis

FX:USOIL   CFDs on Crude Oil (WTI)
708 3 11
Weekly Chart Analysis

The regression channel is still bearish and both my short and long term DMIs are also still bearish . Until at least the short term DMI crosses to the bullish side, I don't really expect all that much multi-week upside.

Having said that, the short term D+ is clearly crossing up towards 20, at least for now. So in the short term, we could get a bit of a bump up. As long as we are in the lower regression band, I'm actually more interested in longs for longer term holdings.

I rejection at the mid regression level around 38ish might allow me to go short again, but the daily chart suggests resistance could be even earlier (35-36.50) if the upper bearish regression channel level there holds. If that level clearly breaks, we could see a run at 50-55 which will likely take until the end of the year. Fundamentally, I'm still not a huge fan of longs though, so I fully expect more hovering or even downwards pressure until this changes.

Daily Chart Analysis


I'm not a huge fan of going long right now because the daily chart suggest upside is likely capped by the upper regression level in the near around 35-36.50, or if it overshoots, 38ish according to the daily chart . That's assuming the Jan 2009 low point at 32.70 doesn't already prove to be too much resistance.

Since we're in the upper regression channel area already, (orange), I'd wait to enter longer term longs until price retests at least the regression channel mid level. Depending on how long that'll take, it could be anywhere from 25 to 28.50ish. Obviously a break of that level would be pretty horrible for bulls with tight stop losses as a run at 20-22 isn't unlikely if that happens.

The short term DMI is now bullish and the long term looks like it could potentially prepare itself for a bullish cross too. Obviously further downside isn't totally unlikely until that happens. DI- of the short term DMI is at around 17, so it wouldn't take much for things to turn bearish again.

H4 Chart Analysis


The regression channel is super horizontal, which suggests we're clearly ranging. In this case, the range is around 27 to 34. Above that, we have 36.5 and 38 as the next crucial levels where a possible rejection could lead to move downwards pressure.

Given the "buy low, sell high" mantra, I'd only really consider longer term longs if price moves beyond the regression channel mid level into the blue "buy area". I would consider selling close to the upper regression channel level around 34, but both my DMIs are still bullish so I can't do that just yet. Having said that, it's not horrible to do an exploratory short around that level, just not idea until at least the shorter term DMI on H4 turns bearish again.

30.50 (probably overshooting to 30) and 27 are my ideal points to go long at the moment SHOULD I get a strong bullish rejection at those levels.

H1 Chart Analysis

All this brings us to the near term outlook...


The regression channel is clearly bullish but we can see price temporarily bounced off the H4 upper regression channel level. We also broke through the 32.70 Jan 2009 low point yet again.

If we stay within the H4 range (27-34), I would expect a bullish bounce at either the mid level (30.50ish) or the lower channel level at 27. So while we are already inside the buy zone of the bullish H1 regression channel, I would hold off going long for now and see what price does at those levels.

The short term DMI is bearish for now, so if anything I'd only take short term shorts for now...which isn't ideal because we're in the H1 buy area. The yellow areas basically show where I'll pay attention to how price reacts, and possible scenarios.


While we are in a buy area on the daily, price simply isn't "cheap enough" yet for me to enter another long yet. At the same time, We're also not close enough to a real rejection area for me to consider anything but short term shorts.

I will sit on my hands for now and will simply play the H4 range until we get a break out. So consider buys at H4 regression mid level (30.50ish) and lower level (27ish), and sells at around 34...and should it overshoot, at 36.50 and around 38. Eventually price will sustainably break out of the H4 range at which point longer term holdings become more feasible.

Until then: BUY LOW, SELL HIGH
Excellent analysis sir!
+1 Reply
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