August Crude set to break higher
USD Crude August Contract: Using the daily continuation chart, we can see a strong rally from the March low. Since the May 6 high we have been in a period of consolidation and posted a small channel formation. This can also be seen as a Bullish Flag. A break from Wednesday's highs would confirm the breakout. Measured move target would then be towards 74.83 (50% pullback) and 77.00 handle.
The last few days of indecision (Doji Days and spikes in both directions) have formed a symmetrical triangle pattern on the 1 hour chart. Bespoke support is seen at 60.50 and is holding up the commodity this morning.
A break of this formation to the upside (through 60.88) holds a target area at 61.80 (the trend of lower daily highs) and offers good risk/reward today. Those looking for a longer play should look for a break of this target then trail the trade higher (towards 74.83-77.00)
Management and risk description
Entry: Buying a break of 60.90
Target: intraday 61.70. Medium term 74.83-77.00
US Crude monthly chart
US Crude 5-year quarterly chart
-- Edited by Adam Courtenay
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