On Monday (August 1) I published a post on USDCAD (SHORT trade triggered on yesterday’s close at 1.3025) and USOil.
For USOil , I was looking for a break in the strong down trend that had persisted for the previous eight trading sessions. Mondays large down candle took the price to 40.06 a fall of over eleven percent in little over a week. Nothing continues in a straight line forever. Technically, it had also broken the key 200 DMA at 40.59 and further falls cannot be ruled out. However, in the meantime we look to BUY on the retrace in the short term for a bounce to at least the 23.6 Fib level and 14 day ATR level at 42.25 and possibly to the 38.2 fib level at 44.00. The move was confirmed with a Tweezer Bottom formation, strong buying momentum on good volume and a break back above the 200 DMA at the close on Tuesday. Should the rise to Target 1 be rejected then the next support is below 40.00 at the April low of 37.60.
We used this example in yesterday’s educational webinar to demonstrate how simple Fibonacci Retracements can be to implement. Also when they are combined with other indicators they can provide levels and targets that are often “self- fulfilling”. Join me on Tuesday August 9th at 11:00 GMT for our next Live Market Analysis webinar.
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