CRUDE stuck within tight trading range
Crude Oil (CRUDE) Technical Analysis Report for Sep 25, 2020 | by Techniquant Editorial Team
CRUDE ended the week -2.7% lower at 40.04 after losing $0.15 (-0.37%) today on low volume. Trading $0.49 higher after the open, the contract was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Wednesday, CRUDE actually gained 1.52% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CRUDE as at Sep 25, 2020):
Friday's trading range has been $0.93 (2.32%), that's below the last trading month's daily average range of $1.57. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CRUDE. Prices continued to consolidate within a tight trading range between 39.12 and 40.75 where it has been caught now for the last three trading days.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 40.52 (R1), Oil closed below it after spiking up to 40.64 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
The market shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying might speed up should prices move above the close-by swing high at 40.75 where further buy stops could get triggered. Selling might accelerate should prices move below the nearby swing low at 39.12 where further sell stops could get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Oil. Out of 231 times, CRUDE closed higher 58.01% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after two trading days, showing a win rate of 54.11% with an average market move of 0.07%.
With four out of the other seven Commodity Markets closing lower today, the ones that stand out on the negative side are NATGAS losing -1.83% and WHEAT closing -1.27% lower. On the flipside the best performers have been COFFEE closing 2.47% higher and SUGAR gaining 1.05%. Read more