Here, I present the official Bull Trading Oil Plan. As you can see price is currently at a support point. If the bulls to do not find the strength they need here, price will surely fall to the next potential support point at 41.75.... What we're going to do is wait. If we buy now, we can potential see price go up to 51.6 area for a full correction (600 pips),which is a nice size profit; however we face the risk of a pretty big drawdown if we see price fall to the lower support points. A drop to the 35 point (over 900 pips) is very possible.
Think about the USD/CAD and it's correlation to oil. The US dollar has been taking a beating for some time now. It is without a doubt due for a correction. If that correction ends up being a big one, then a drop in oil price will be a sure thing.
To avoid such a big drawdown, we will wait for price to drop below the 41.75 point. Once we cross that point, we will begin our buying. If price comes down to our 35 support point, we will buy more and at that point we will be expecting to harvest a crop of at least 1600 pips when it reaches our 51.6 Take Profit point. We need to ensure we use low leverage in order to be able to endure all conditions. Make sure you don't run out of seeds to plant, remember we could face an extended drop if support points fail to hold. Plant wisely.
We also have the crude oil inventories announcement coming up this Wednesday July 26 at 10:30am EST followed by the FOMC Statement and the Federal Funds Rate.
So, this coming Wednesday, I believe we will have a better idea on whether price will more likely rise to our 51.6 point or fall to our lower support points (possibly as low as 35.6).
Whatever side you're on, I wish everyone well and hope you find direction in the map I have provided. Thank you for reading!
