Crude oil has completed the minimum requirements for a megaphone bottom (red) on its blue price channel.
It could continue to megaphone to a retest of its pink flat-bottomed megaphone neckline or a little higher and then resume its move down (green scenario), or it could break out of the little megaphone for a move to retest its potential inverse head and shoulders neckline (gray).
If oil returns to its neckline -- and there’s a good possibility of that heading into Labor Day -- it’s a strong favorite to reverse there to form a triangle right shoulder (orange scenario) on the inverse H&S. It could break out (blue scenario), but that’s unlikely.
Oil could also start a new megaphone inside its red megaphone bottom to continue consolidating here before continuing down (purple scenario).
Oil Inverse Head And Shoulders Vs. Triangle
Major inverse head-and-shoulder bottoms often complete with a triangle right shoulder. With Labor Day coming and oil’s weak season thereafter, a triangle right shoulder (green scenario on closest chart above) is the most likely scenario.