Crude Oil Pin Bar & Range Support Fails | May 30th
Crude Oil – 50% Pin Bar Entry Fails – More Downside?
In my weekly market commentary, I discussed the crude oil pin bar that had formed at the range support. Although it looked identical to the last pin bar at the same level which profited, I was highly skeptical it would follow through as the setups, price action and context was not as supportive this time around.
Looking at the chart below, this ended up being correct as this last pin bar failed to produce any follow through, and anyone trading the 50% pin bar entry technique got crushed in the process. This is why we don’t just trade pin bars blindly. We are not pattern traders – we trade price action in context, and when you learn to read the context of the price action – you begin to spot why pin bars will win or fail ahead of time (as in this case). The impulsive selling at A showed greater force from the bears this time hinting bulls will have more to contend with on the next bounce.
The result was after two days of stalling at the 61.8% retracement of the pin bar at B which were two inside bars back to back (an ii pattern), it had one bull close in four, with massive selling (bar C) after the first bull close. Today followed up with more selling, taking out the pin bar & range support lows, tripping stops sub 92.00.
Considering the range has been broken, bears will have to wait till the 97.00 range highs before shorting, or look to sell just shy of 96.00 targeting the 92.20 lows. Bulls now will have to wait for a deeper pullback towards 89.45 before considering longs.
For those wanting to learn to trade price action, access to the traders forum, lifetime membership & more, visit my Price Action Course page here.
Want More? My private members get all my trade ideas & market commentary up to 3x per week. Click here to become a member.
Want to Learn Price Action Strategies for Trading Forex?
Sign Up for our Monthly Newsletter and Get our FREE E-Book