Here is how I see the oil market unfolding
It's a daily continuous CL chart and I have added a Trendline fan. As you can see 2 trendlines have been broken to the downside with the next Trendline coming into play at 110 and then the last one going back about 2 years at 87.
As you can see the upmove had as first target (green line labelled T) 115 and as second target 145, which was tested to the upside, but then proved the correct target for the upmove.
Now let's look at the upmove itself. We have retraced more than 33% and are about to test the 50% retracement level at 116.50. That corresponds loosely with the first target of the upswing at 115.40.
A bit below you find the Volume weighted longterm MA (240WMA) which might add support as well.
That means I see the 116-114 area as a strong support area for oil, with the 110 level as second support below, as that level corresponds with a 62% retracement level from the top.
Add to that reports at CNBC that with gasoline below 4$ demand is coming back into the market, I see a bottoming process starting in oil at the 115 level with 110 as eventual spike low.
I usually don't trade long term, I trade day by day. Still I like to have a view on the market. I like to know what longer term traders see in a market I trade. And maybe I will manage to trade longer term myself.
