What Is Happening with Crude this Week?
I know most futures traders like to trade crude as it is one of the more easier contracts to trade in theory because of the volatility.
Crude is at a key area where it should move sideways for a bit before falling back down to retest the lows or perhaps make new lows. You can see by the longer term chart below where I think that crude is headed. I took most of my profits off the table when crude hit the 62.80 area and then stalled. That by itself tells you a lot. Look for it to start to form a nice volume point in this area as the longs and the shorts battle it out.
In the COT (Commitment of Traders) report we can see that there is heavy longs building at a level not seen before. It means that majority of the traders think that the market will move ever higher. I don't think that they are right. It is too enticing at the moment for the Commercials that control the market to let them simply ramp higher and collect their cash. There still is no reason for crude to move higher. Never was to be honest. I still expect a pullback to the 55 level to shake out the longs. This won't happen overnight but should happen over the next month or two. Institutional sentiment is very high for longs. However not really yet for the retail guys who got whacked in the last sell off.
I think that you can generally follow my pattern on the chart below. You are essentially looking for shorts ok. No sense chasing a few dollars higher at this point. There is no indication yet that the market will resume its uptrend any time soon. Anything above 65 nullifies my present analysis but as you can see I am looking short. I have been for a while now. This sort of action favors the long term swing fellows who don't really care what happens minute by minute in the open market. It doesn't favor the day traders who use leverage as if it were a sure bet for their profits.
The two key value or volume areas are at the 56 area and the 48 area respectively. You can see them on the chart. I have identified them for you. This is simply the area controlling price at the moment.
So over the course of the next few weeks look for crude to make a pretty good correction when least expected. Wishing you good trading.
Crude is at a key area where it should move sideways for a bit before falling back down to retest the lows or perhaps make new lows. You can see by the longer term chart below where I think that crude is headed. I took most of my profits off the table when crude hit the 62.80 area and then stalled. That by itself tells you a lot. Look for it to start to form a nice volume point in this area as the longs and the shorts battle it out.
In the COT (Commitment of Traders) report we can see that there is heavy longs building at a level not seen before. It means that majority of the traders think that the market will move ever higher. I don't think that they are right. It is too enticing at the moment for the Commercials that control the market to let them simply ramp higher and collect their cash. There still is no reason for crude to move higher. Never was to be honest. I still expect a pullback to the 55 level to shake out the longs. This won't happen overnight but should happen over the next month or two. Institutional sentiment is very high for longs. However not really yet for the retail guys who got whacked in the last sell off.
I think that you can generally follow my pattern on the chart below. You are essentially looking for shorts ok. No sense chasing a few dollars higher at this point. There is no indication yet that the market will resume its uptrend any time soon. Anything above 65 nullifies my present analysis but as you can see I am looking short. I have been for a while now. This sort of action favors the long term swing fellows who don't really care what happens minute by minute in the open market. It doesn't favor the day traders who use leverage as if it were a sure bet for their profits.
The two key value or volume areas are at the 56 area and the 48 area respectively. You can see them on the chart. I have identified them for you. This is simply the area controlling price at the moment.
So over the course of the next few weeks look for crude to make a pretty good correction when least expected. Wishing you good trading.
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