U.S crude oil had completed its bearish correction in daily time frame near 65.20 on 19th July and went for a bullish impulsive wave towards 74.40. The lower trend line seems to have been acting as a support to the west texas oil prevailing it for now from going any further bearish. Oil market has recently been affected by the crude oil inventories yestarday which showed increase in number of barrels by 3.6 million in July. We applied ichimoko to understand different level of supports which are not letting the bears take over, though the fundamentals are denoting immense weakness in the ruling commodity but still WTI maintains its position well above the clouds lower outline along with our 50%fibb below the current markent price. Some how from weekly charts perspective, the market is showing that there is still room for a correction of higher degree but when we move down to our lower time frame, the four hourly chart, the market is under oversold conditions which asks for a bullish recovery from this zone. 

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

In four hourly chart, according to the elliot wave pattern, the market went through a higher degree of bearish correction in July, followed by a lower degree of 5 wave bullish structure. But now again the market is showing signs of weakness and landed near our daily and weekly supports of critical price action level. Also in daily, fibb drawn from 76.40-51.60, we can see that the oil market is standing above 61.8%fibb which can become an indication for bullish reversal. On the other hand, a breakout below our lower trend line i.e 67.0, will drive the market towards our exponential moving average 200 in daily i.e 62.75-61.0. This zone will then be determined as a completion of bearish correction on a higher degree i.e daily and weekly time frame. Retail traders can take better buying positions from the aforementioned levels with targeted destination as 74.45. 

WTI D1

Aug 05 2021