The rubber band effect.
When pulling a rubber band at both ends the rubber band will be stretched to its capacity. If you let that rubber band go it usually will go back to its original form and size however if you continue to stretch that rubber band to its capacity the band will eventually break and pop now it no longer serves it primary focus. I know what you might be thinking, why am I talking about breaking rubber bands ? Well actually I’m talking about the oil market breaking out of its normal range over the past 12 days roughly. See crude oil was range bound in its normal capacity since 06/03/19 only to finally break out that capacity on 06/20/19 with confirmation. The short term range bound market was strong.
Since then crude has made higher highs everyday since 06/20/19 I don’t expect that to change heading into tomorrow’s session. I’ll be looking to get long above 59.38. I will wait until the market can trade above that level because I do believe there’s some minor resistance 59.38 ish if the uptrend can continue I’ll be looking for a target near 59.62.
Now please keep in mind I’m a trader and I trade opportunities as they present themselves that match my foundation and strategy.
So if the market pulls back I’ll be looking for the market to trade 58.63 to 58.38 this is an aggressive entry for my taste but I do think the opportunity is there if the bears are trying to take control of the trend on the day.
The price level that I would wait for like a sniper waiting for my target to get in my cross hairs would be below 58.17 to 57.95 and then 57.78 don’t be surprised if we go lower and eventually trade down to 57.51. If this happens crude can end up right back in its range bound capacity I mentioned. Hints the rubber band effect
By the way the oil report comes out today 10:30 am EST so make sure you’re protected at all times.