WTI Price Analysis: Bombs away, breakeven achieved, fading rallies

  • WTI restest resistance structure for a day trading opportunity. 
  • The swing trade is now running at breakeven.

In an update to the ongoing WTI analysis, there has been a price action development to the following story: WTI Price Analysis: Bears licking their lips for a 1:5 R/R swing-trading opportunity

For a quick recap, this trade was a weekly analysis that expected Wave-3 to extend all the way into the low 30's, as follows:

The trade setup was determined from the daily and 4-hour time frames, as follows:

Daily setup

4-hour structure and setup

Sell limit triggered

Breakeven stop-loss achieved

The position has been protected with a breakeven stop-loss.

Bears are now in for a free ride towards the target and a possible 5R outcome.

The next major obstacle is daily support, as illustrated above. 

However, the trade should be protected by this resistance.

If the resistance is tested and holds, then there is a high probability that the target will be achieved on a subsequent retest and break of the support structure. 

Day trading opportunity

Meanwhile, the price action has given rise to a day trading opportunity as follows:

As can be seen, and as expected, the support structure was respected and the price has corrected 38.2% of the move.

This gives rise to a day trading opportunity by fading the rally. 

15-min chart

The resistance is holding and the price is on the verge of crumbling below the 21-moving average.

There are one or two more steps in price action that need to confirm a higher probability setup though.

1. We need to see the price move lower and create a sell-limit level at the structure. 

2. Technical indicators and strategy rules should be applied. 

A trade setup could be in the makings for the last sessions of the week where high volatility is expected due to US and European politics as well as US Nonfarm Payrolls

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