WTIC Bi-Weekly - Oil has been compressing in this ‘bull wedge’ with positive divergences for nearly four years would you believe. The pattern looked to be complete from its wave-structure, though the ‘breakout’ failed, which was a disappointment. There was a volume spike on the break too (not shown), though there was a warning— as the weekly had formed a ‘hammer’ style candle, and although it was nullified by price going higher the following week, it couldn’t hold, and then reversed sharply putting in a hoofing red ‘downward-dynamic candle’ whose oppresive influence is still in effect today.
It’s no surprise really, seeing such a twist at the ‘breakout’, as when the rewards from a pattern are so excessive as it is here, you can guarantee the bullish sentiment will have to be dampened down first. So it wouldn’t surprise me either to now see a ‘breakdown’ from the pattern, bringing price down into the lower $50’s or even deeper into the mid $40’s? Which would have the desired effect on that sentiment, it would also trigger the stops of many remaining bulls just prior to a violent reversal, either back into the pattern or a ‘gap’ higher; and then continuing up with speed, leaving most who wanted to be in at the right time scramblng in the dust. It may work out different to that of course, we’ll see…
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