US OIL - to mid 2021 [Overall bullish]
Hello Traders and Analysts,
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged long, due to purchasing further increments upon imbalances.
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities.
A bullish scenario is needed, as well as a bearish , this is a game of patience.
Master Key for zones
See the original analysis here; to capture the extent of the move.
The US oil original analysis; December 2020. - The original monthly zones hit towards March to May 2021. This has been successfully achieved now.
Monthly Imbalances
Price has currently filled a monthly imbalance, with a new fresh imbalance zone awaiting price action to occur. The probabilities are strong here for price to enter into this zone, purely based on the candle wick which has been confirmed from February 2021. The wick on the lower time frames has provided evidence of this reaching a fractal point at $59.20 per barrel. [Using the daily chart in reference here]. Price had created an engineered low, for the shakeout of the sellers who are looking for sells of the fresh "high". Note, on the daily, the trend line is well respected with the three soldier candle pattern 'identified as a sell off", however, this is a perfect opportunity to add a long.
The monthly imbalance - is still showing the respective low as explained above. The price of oil has continued to show it's strength reaching the next liquidity wick fill at $66.34-54. Now, the next important imbalance zone is yet to be breached and tested. Price can now create a fresh test of the monthly chart, applying as to what the structure on the monthly is showing is, the price can have a high probability of moving back to $60.00 - $62 zone to create a solid rally base rally formation setup.
Bearish monthly imbalance scenario:
Where price is now entering a fresh imbalance - this is a great opportunity to close out long positions which have been held in a shorter run up or simply close out profits to de-risk and transfer the risk by offsetting shorts.
Why? - Simply put, fresh zone is a clear opportunity for the imbalance to occur. The imbalance will be closed out and the market structure will offer a new opportunity. Price can dramatically collapse again with a strong supply, however where price is still showing "long". Oil can be sold off to weekly imbalances or in a worst case scenario to the below Blue, monthly imbalance.
Weekly Imbalances
The Weekly imbalance provides a good indicator her where price can create a weekly supply or sellers imbalance as the zone is a fresh touch. The probability of price retracing from the newly created high, is a strong possibility. However, as there is a zone higher, Oil can still use this imbalance as a base, to create strong price action floating within a range of $67-60 per Barrel. Look into the smaller time frames for pivot points assessing the risk of entering a trade.
Eight hour Imbalance
Below are the eight hour imbalances, where a great structure has taken place to provide an opportunity for the base to built upon. The imbalance here will attract the short sellers and scalpers and hedged sellers to cover longs. However the 50% retrace zone aligns perfectly to a strong indicator of where Fibonacci lines mock up a solid alert to monitor the minor inefficiency taking place here.
The main wick of interest here - is located at 0.705,for two reasons, one being which touches the bullish trendline - while this co-insides with the inefficiency, this zone is a great area to be present for a engineered fractal for longs.
Daily imbalance - for a simplified view
Again the imbalance of the monthly aligns with the daily low, so take into account here a inflow opportunity for the building up of a buying imbalance at around $59-60.XX
Understanding the context behind Oil with the "disastrous" negative price of the Oil futures crash.
2020-2021.
We have seen a nice impulse into the channel and a rejection upon reaching the trendline at $53.00
Good question, based on the fact - from a technical standpoint - the sell off back in February, March 2020 - reversed on a fractal point within the market structure to the crisis of Oil supply being heavy weighted in comparison to the demand . The spike to zero was the abundance of supply which effectively the storage supply became over saturated and "worthless", the May contracts were not accepted for physical delivery and the paying for the delivery took place to prevent further storage.
This imbalance was created in which created the impulse. Price re-established itself with $30-36 zone for a further imbalance where price will now look to as a strong demand for price engineering if needed.
UK Crude, Vs Brent - correlation
Understanding the Fundamentals behind the Supply, Demand & Future Supply through inflation of cause and effect.
Oil prices and levels of inflation are often seen as being connected in a cause-and-effect relationship. Simply put with oil current at $66.00 per barrel, as oil prices move up, inflation—which is the measure of general price trends throughout the economy—follows in the same direction resulting in a higher overall price.
Keep in mind, as the price of oil falls, inflationary pressures start to ease.
Producer Price Index [PPI]
This is a measurement of the rate of change in prices of said commodity [Oil], where the change in prices of the products sold is measured by the producer. The exclusion of Tax, trade margins and transport cost which are all variables a buyer of a physical will have to burden.
The PPI is a average movement of price, which are subsequently tracked by the economic indicators dealing with the price fluctuations end users have to pay at the end of the supply line.
Below is the inflation ETF vs Oil - providing some crucial cause and effect over the future supply of Oil and where price is overall moving towards, again use inefficiency in the market.
Do you enjoy the setups?
*10 years combined analysis experience in capital markets
*Focus on technical output not fundamentals
*Position and swing trades
*Provide updates where necessary - with new updated ideas tracking the progress.
If you like the idea, please leave a like or comment.
To all the followers, thank you for your continued support.
Thanks,
Team LVPA MMXXI
A Note before reading - this is a forecast analysis - based upon our trading strategy. This is tagged long, due to purchasing further increments upon imbalances.
Please do not take this as face value and conduct the relevant investment strategy to successfully trade the probabilities.
A bullish scenario is needed, as well as a bearish , this is a game of patience.
Master Key for zones
- Blue = Monthly
- Purple = weekly
- Orange = Daily
- Magenta = 8 Hour
- Grey = 4hour
- Pink = 1 hour
See the original analysis here; to capture the extent of the move.
The US oil original analysis; December 2020. - The original monthly zones hit towards March to May 2021. This has been successfully achieved now.
Monthly Imbalances
Price has currently filled a monthly imbalance, with a new fresh imbalance zone awaiting price action to occur. The probabilities are strong here for price to enter into this zone, purely based on the candle wick which has been confirmed from February 2021. The wick on the lower time frames has provided evidence of this reaching a fractal point at $59.20 per barrel. [Using the daily chart in reference here]. Price had created an engineered low, for the shakeout of the sellers who are looking for sells of the fresh "high". Note, on the daily, the trend line is well respected with the three soldier candle pattern 'identified as a sell off", however, this is a perfect opportunity to add a long.
The monthly imbalance - is still showing the respective low as explained above. The price of oil has continued to show it's strength reaching the next liquidity wick fill at $66.34-54. Now, the next important imbalance zone is yet to be breached and tested. Price can now create a fresh test of the monthly chart, applying as to what the structure on the monthly is showing is, the price can have a high probability of moving back to $60.00 - $62 zone to create a solid rally base rally formation setup.
Bearish monthly imbalance scenario:
Where price is now entering a fresh imbalance - this is a great opportunity to close out long positions which have been held in a shorter run up or simply close out profits to de-risk and transfer the risk by offsetting shorts.
Why? - Simply put, fresh zone is a clear opportunity for the imbalance to occur. The imbalance will be closed out and the market structure will offer a new opportunity. Price can dramatically collapse again with a strong supply, however where price is still showing "long". Oil can be sold off to weekly imbalances or in a worst case scenario to the below Blue, monthly imbalance.
Weekly Imbalances
The Weekly imbalance provides a good indicator her where price can create a weekly supply or sellers imbalance as the zone is a fresh touch. The probability of price retracing from the newly created high, is a strong possibility. However, as there is a zone higher, Oil can still use this imbalance as a base, to create strong price action floating within a range of $67-60 per Barrel. Look into the smaller time frames for pivot points assessing the risk of entering a trade.
Eight hour Imbalance
Below are the eight hour imbalances, where a great structure has taken place to provide an opportunity for the base to built upon. The imbalance here will attract the short sellers and scalpers and hedged sellers to cover longs. However the 50% retrace zone aligns perfectly to a strong indicator of where Fibonacci lines mock up a solid alert to monitor the minor inefficiency taking place here.
The main wick of interest here - is located at 0.705,for two reasons, one being which touches the bullish trendline - while this co-insides with the inefficiency, this zone is a great area to be present for a engineered fractal for longs.
Daily imbalance - for a simplified view
Again the imbalance of the monthly aligns with the daily low, so take into account here a inflow opportunity for the building up of a buying imbalance at around $59-60.XX
Understanding the context behind Oil with the "disastrous" negative price of the Oil futures crash.
2020-2021.
We have seen a nice impulse into the channel and a rejection upon reaching the trendline at $53.00
Good question, based on the fact - from a technical standpoint - the sell off back in February, March 2020 - reversed on a fractal point within the market structure to the crisis of Oil supply being heavy weighted in comparison to the demand . The spike to zero was the abundance of supply which effectively the storage supply became over saturated and "worthless", the May contracts were not accepted for physical delivery and the paying for the delivery took place to prevent further storage.
This imbalance was created in which created the impulse. Price re-established itself with $30-36 zone for a further imbalance where price will now look to as a strong demand for price engineering if needed.
UK Crude, Vs Brent - correlation
Understanding the Fundamentals behind the Supply, Demand & Future Supply through inflation of cause and effect.
Oil prices and levels of inflation are often seen as being connected in a cause-and-effect relationship. Simply put with oil current at $66.00 per barrel, as oil prices move up, inflation—which is the measure of general price trends throughout the economy—follows in the same direction resulting in a higher overall price.
Keep in mind, as the price of oil falls, inflationary pressures start to ease.
Producer Price Index [PPI]
This is a measurement of the rate of change in prices of said commodity [Oil], where the change in prices of the products sold is measured by the producer. The exclusion of Tax, trade margins and transport cost which are all variables a buyer of a physical will have to burden.
The PPI is a average movement of price, which are subsequently tracked by the economic indicators dealing with the price fluctuations end users have to pay at the end of the supply line.
Below is the inflation ETF vs Oil - providing some crucial cause and effect over the future supply of Oil and where price is overall moving towards, again use inefficiency in the market.
Do you enjoy the setups?
*10 years combined analysis experience in capital markets
*Focus on technical output not fundamentals
*Position and swing trades
*Provide updates where necessary - with new updated ideas tracking the progress.
If you like the idea, please leave a like or comment.
To all the followers, thank you for your continued support.
Thanks,
Team LVPA MMXXI
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