How have the crude oil markets performed this week ?

In a relatively quiet week for news, WTI crude oil has traded sideways, currently at prices close to the beginning of the week. Whilst large inventory draws, and confirmation of OPEC cut compliance, are bullish, the market has not made any significant moves this week.

The chart below shows CLX7 contract for w/c 2nd October.

The horizontal lines represent the VWAP bands, with the pink line being the Volume Weighted Average Price, and the bands above and below being standard deviations from it.

The week started bearish, with the market struggling to get above VWAP, then yesterday (Thursday), we saw a push back up to the top of the band during the US session. This was not on particularly strong volume, and is likely driven by stops being hit, from the short sellers.

US Crude Oil markets. W/C 2nd October

Friday’s are often balanced or swing days. At present, I’m considering the markets may sell off, and then swing back up, to stay within the weeks sideways range. There is a large head and shoulder formation on the one hour chart, which suggests selling today.

So, until proven otherwise, will be looking to sell the top of the VWAP bands from today’s chart. The chart below shows the market for today, Friday, and it was already been moving from the top to the bottom of the VWAP bands, offering some entry opportunities.

US Crude oil futures contract CLX7. Friday 6th October

About the author

Trading and Investment

Traded the markets for over 15 years, including Commodities, Bonds, Currencies, Equities, and Indices. I have also worked as a Chartered Financial Planner.
CeMAP, CeFA, DipFA, AdvDipFA, Ba(Hons) Economics, Chartered ALIBF

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