In the end of June 2014 amid Iraq issue we witnessed MCX Crude topped out near 6500 levels and made a low of 5970 recently.
This is one of best example
where the phrase fits superbly that “Buy on rumors and sell on news.”
This is the part of the game but price charts reflects everything. In the
entire trend from 6500 to 5970 not a single bar gave close above prior bars
highs and trend continued on downside. This bar technique is very simple but
important from trading perspective. We are also applying Elliott wave theory to
forecast the prices which suggested that Crude prices are very matured stage of
down move when prices were trading at 6000 and accordingly we published the
research in our “The Commodity Waves
Short Term Update” for our paid clients.
Below write up we have taken from The
Commodity Waves Short Term Update dated 17th July 2014 suggesting our positive bias.
“For WTI Crude, in the
last trading session prices showed some relief sign, moved higher and closed on
positive note. For the first time prices have given close above prior bars high
and made bullish bar. This suggests that trend is probably in reversal mode.
Now, one should be very careful and today’s follow up action will provide
further confirmation that whether trend is changing or not. Now, on downside
price action near 100 level is very important and protection of this level on
closing basis is important to catch a reversal from here on. On upside break
above 102 level will provide positive confirmation.
As shown in 60 mins
chart of MCX Crude, in the last trading session prices opened with gap up,
throughout the day prices sustained above the gap and closed on positive note.
Currently prices are intact in downward moving channel and prices have given
close exactly near the channel resistance. But looking at the structure of the
WTI Crude, there is a higher probability that downside correction has completed
in form of triple correction pattern (a-b-c-x-a-b-c-x-a-b-c). However, positive
price confirmation is important which we will get when prices breaks above 6120
level where channel is placed and on downside price action near 6000 becomes
very important to decide the trend.
60 mins Continuous chart:
60 mins Continuous chart:
Trading Strategy on 17th July 2014: In
short, prices are trading at crucial level where break above 6120 level will
take prices towards 6160/6180.”
on same day:
As expected after breaking above 6120 levels, prices
did not look back and achieved our mentioned levels.
Trading Strategy on 18th July 2014: “trend is positive with the
support of 6130. On upside price can move towards 6250 levels.”
Happened: prices touched the high of 6264 and currently retracing on
downside, so what should be the trading strategy from here on ?
So, over short term
where prices are headed? To know the answer, Subscribe to “The Commodity Waves Short Term Update” which
includes MCX Gold, MCX Silver, Copper and Crude with important levels. For more
information visit Pricing page.