Hey guys,
I hope you’re enjoying your weekend! It’s a big week coming up for me with a few changes expected so I’m slightly distracted from my regular posting routine.
As a result, I just want to I’ve a quick weekend update on the oil trend line bounce trade I was talking about on the blog. Click the link and have a look if you missed it, but it basically was speaking about how the market was reactivating and respecting a historic higher time frame trend line.
Take a look at the extract below:
Now look at where we ended up as the markets closed on Friday night:
CL Daily
Now since we saw the rip your face off rally came to an end in early July, oil has been struggling to gain any sort of traction again. It’s now on track to end its third week of losses in a row.
Earlier this week we saw the OPEC meeting in Vienna conclude that the OPEC and non-OPEC producers’ compliance with the output cut deal continued to decline. All this did was point to rising supply in the market and therefore put further downward pressure on price.
Supply increases were also seen in the US with weekly reports released by the API and the EIA both indicating this fact. Not great for any short lived long bias I was indicating last week. Levels or not, the momentum was too much.
But this is why I preach waiting for confirmations and trading retests. Not only does it increase your win rate, but it allows for much greater risk:reward when you keep your stops tight and let winners run.
Take a look at Friday’s retest in the opposite direction:
CL Daily
The trend line is still being respected, but we also have a clear horizontal retest to manage our risk around at the same time.
Yolo.
✌🏻.
| Steemit Blog
Market Analyst and Forex Broker.
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