Price action on WTI presents both a potential continuation and reversal pattern. We just need the catalyst to provide the fuel for a breakout, either way.
I had expected WTI to have reached $65 by now but recent price action suggests bearish momentum could be in the pipeline.
The high of $63.27 formed the upper wick of a shooting star reversal on D1, with the subsequent bearish close confirming an Evening Star Formation at the highs. Intraday price action has seen a mild bounce from the low of the evening star formation, which could be forming a bear flag below the monthly pivot. In turn this leaves potential for a H&S pattern to form with a price objective around $53.30.
To confirm the H&S we’d need a break below $58.84 but we could also consider the break of the bullish channel as a signal to seek bearish setups on lower timeframes.
Alternatively we could seek bullish setups if we do climb back above the monthly pivot and remain within the bullish channel, targeting the original $65 price objective.