CRUDE breaks back below 20-day moving average
Crude Oil (CRUDE) Technical Analysis Report for Oct 23, 2020 | by Techniquant Editorial Team
CRUDE finished the week -3.05% lower at 39.78 after losing $0.83 (-2.04%) today on low volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CRUDE as at Oct 23, 2020):
Friday's trading range has been $1.35 (3.32%), that's slightly below the last trading month's daily average range of $1.58. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CRUDE.
Two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on April 17th, CRUDE actually lost -14.14% on the following trading day.
Prices are trading close to the key technical support level at 39.50 (S1). The contract closed back below the 20-day moving average at 40.27. The market found buyers again today around 39.57 for the third trading day in a row after having found demand at 39.71 in the previous session and at 39.78 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 39.50 where further sell stops might get triggered.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Bottom Pattern" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for Oil. Out of 54 times, CRUDE closed lower 55.56% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 53.70% with an average market move of -0.86%.
With five out of the other seven Commodity Markets closing lower today, the ones that stand out on the negative side are NATGAS losing -2.52% and COFFEE closing -1.1% lower. On the flipside the best performers have been WHEAT closing 2.07% higher and CORN gaining 1.01%. Read more