Sunday, July 31, 2011

Crude Oil (CL) Uptrend held? 7/31

To the left is a 4 hour chart of crude oil. Over the last couple weeks we have been in a pretty slow grinding up trend, with higher highs and higher lows for the most part. After spending more than the average amount of time hovering around 100$ a barrel, we then saw a larger than average sell off. It appears though that we have held the previous low to this point. We can also see divergence with the MACD average in the long term (shown by the purple lines) and the histogram in the short term (shown by the yellow lines). We also saw a lot of volume stepping in when we reached the 50% retracement of this recent uptrend shown in green. I think this is going to be a good spot to buy to try to get back to 100$ a barrel.

Silver (SI) breaks into retracement channel 7/31

Silver's daily chart to the left, and as we can see over the last two weeks we have finally broken past the strong resistance formed right around 39 (shown in purple) by the 38% retracement of the march may meltdown. Now that we have gotten into this retracement channel between 39 and 43, I see it as a high possibility that we bounce here back up to at least 43. I think on a long term outlook, I would be looking to buy anything near 39 to play towards the topside of the channel.

Gold Look at the Week Ahead 7/31

(Chart 1 - Gold Daily SStoch, RSI, MACD Divergence)
(Chart 2 - Gold Daily Zoom)
(Chart 3 - Gold Daily)

Compare chart 1 to the price action on charts 2 and/or 3.
See how the momentum indicators in chart 1 make lower highs as gold makes higher highs in price at the same time?
This is a sign of impending weakness.
Furthermore with this point, SStoch and RSI are both in traditional "overbought" territory (+80 and +75 respectively).

One can also see that gold is governed by 3 bullish channels.
We are in the top 1/4 of all 3, which is an additional measure of being overbought
Furthermore, the latest daily bar has a nice upper wick after stalling at the 1640 resistance

Based on all this, I would say gold is a sell here. However, I usually like to have a nice shooting star in the price before I go short. I would sell here if you are aggressive with a 1650ish stop. I would sell a break of 1609 if you are conservative.

If this is indeed a top for the moment, then I expect price to fall to 1562.5 initially, and 1480-1500 finally.

SNP Look at the Week Ahead 7/31

(Chart 1 - SNP Daily Extra Zoom)
(Chart 2 - SNP Daily Zoom)
(Chart 3 - SNP Daily )

Looking at the charts, I see 3 important bullish channels that can be governing current price. Using principles from the VSA bible "Master the Markets" (google it if you have never heard of it), and applying them to any of these channels, we can define the SNP as oversold.

This is bullet point number 1. We can further our bullish case by looking at the price action vs. volume on Friday. Although not a true hammer, we had price move well past the 2nd stnd. deviation (red Bollinger Band), and then close inside of it. This happened on far more volume than any of the previous days.

Based on this, and assuming this Debt Ceiling crap doesn't throw a giant curve ball in the next few days (which is a big "if" lol), I see this as a buying opportunity for a move up to the 1328 area.

Sorry for the Lapse in Coverage

Sorry for the absence guys...
Sandwich had some personal stuff to take care of and I was busy as hell at work.
However, we should be back to posting a few things a day going forward.


Tuesday, July 19, 2011

Dollar Index (DX) Ascending Triangle 7/19

To the left is a daily chart of the Dollar Index (DX). I decided to do a second post to Dolemite's because we get different continuation charts based on the software we use, so sometimes different viewpoints can be seen. After reaching our lows @72.86, we seem to have been forming a strong ascending triangle. Each rally has rejected the lowest fib retracement (shown in purple) of the prior down move and every move down has made a higher low, creating a strong trend line (shown in yellow). Usually these resistance / support areas attract the price and it looks like we might see the dollar get down to the 74.9 area over the next couple days, but in the end I feel this type of formation breaks towards the upside and we will see a dollar rally that can actually break the 38% retracement level around 76.25 and hold it.

Crude Oil (CL) Target Reached 7/19

Hourly chart of Crude Oil (CL) to the left. In a post yesterday we pointed out we had reached the bottom of a channel and the lower fib retracement from the previous downmove. We also looked to target the upper end of the channel around 98-99 from this buy and this morning we have already reached this area. While ultimately I think the breakout of this channel might be to the upside, I personally will lighten my position here and then wait for any bearish candlestick formation or divergence to form to pull the rest of this position off. If the signal forms inside the channel / retracement area then I might look to reverse my position too.

EDIT: An hour after this post crude formed a nice shooting star off the top trendline and I have exited my position. I might look to go short soon as well.

SnP Mini Future Daily Chart 6:45AM 7/19

(chart 1 - snp daily chart zoomed)
(chart 2 - snp daily chart)

OK, here is the SNP 500 september future.
Price is bracketed between significant support and resistance.

We have support at 1295 (62% fib retrace of jun-jul rally and high of june chop/stall zone).
We have resistance at 1315-1309 (32% retrace of july selloff and prior shallow (32%) retrace of jun-jul rally) (also bottom of MML trading range at 1308.50)

I think we will get a close over/under this resistance/support in the next few days.
If it closes above resistance / below support, I think a 30 point move is feasible. (1345 or 1265)
I think we get a close over 1308 today and then go higher from here and test 1345

In the next few weeks, we may have a downside test of the longterm orange bullish channel (see chart 2 for scope of this channel). This has held for 2.5 years. If it breaks this, then the neckline of the head and shoulders sandwich is so fond of (search recent snp posts if curious) (also on my chart in white) comes into play.

Monday, July 18, 2011

Dollar Index (DX) Analysis 7/18

(Chart 1 - Dollar Index Daily)

Globally, the USD is in an uptrend (orange channel). However, we are right in the middle right now.

75.75-76.00 is strong resistance.
We got above it last night/this morning, but are now almost back under it (currently 75.80)

If we close here or a bit lower, I think we retest 75 or possibly even 74.50. Long term I am a dollar bull as eventually I think we will test the highs of this orange channel... However with the recent price action, I think we get another 75 test before we break out to new recent highs.

EUR/USD Approaching key resistance 7/18

To the left is the hourly chart of the EUR/USD pair. A while ago I posted about the triangle it was forming and while I thought we might get one more bounce before breaking to the downside, it appears it chose to just break it and kickstart a downtrend. We saw a nice retracement in the middle of last week to just break back in and then out of the previous triangle (shown in purple) and also hold the deep retracement at 1.43 (shown in yellow). We now have pulled back out of the yellow retracement but are looking to head back to the lower level. We also see this 38% level corresponds almost exactly with the 61.8% level of the most recent up moves retracement @1.4115-1.412. This level seems like it will be key to ensuring this downtrend continues, and any good divergence or candlestick formation off this level should be a good selling opportunity.

S&P (ES) Breaks 1 support, 1 to go 7/18

To the left is the hourly chart of the s&p. This morning it looks like we have finally broken the 1300-1303 level which had been providing a major support (except the brief break last week). I posted a couple weeks ago that I thought a nice head and shoulder formation on the weekly chart was in progress and have been short since then. So far so good, but it will be important to see how the S&P reacts to breaking this support and see if it can hold when it gets retested from below. We can also see we held the deep retracement at 1291 shown in red, and will need to eventually break this last retracement and previous high peak in order for this to continue to our eventual neckline around 1255-1260.

Crude Oil (CL) Lower end of channel

To the left is a 4 hour chart of crude oil. As you can see, we have been in a little bit of a channel for the last week or two (shown by the yellow trendlines on chart). It seems like currenlty we are at the lower end of this channel, which also lines up with the 38% retracement of the prior down move (shown in green). We also see a little bit of divergence between the two recent low peaks as we dont quite take out the previous low and our MACD has gone further than the previous down peak. It also looks like we are somewhat holding these green retracements, so I would look to take off at least half of this position at the 61.8% or about 98$ range.

Daily and Weekly Gold Chart Analysis 7/18

(Chart 1 - Gold Daily)
(Chart 2 - Gold Weekly)

1600 has fallen, like so many psychological resistances of the past in gold.
We are currently trading 1601.

Here is my "intelligent" commentary:

The orange daily/weekly uptrend is very well defined.
We are at the upper 1/4 of it currently (high is 1629 today)
Gold faces significant resistance at 1620-1640.
Although I think it is still very bullish, it doesn't present trading value as a buy for me.
1620-1640 can be sold if hit today or tomorrow, but i would use low leverage/risk if at all.

Regardless if you look to enter a sell, or a pullback buy, wait for 60 min candle confirmation before entering a trade!!!

Daily and Weekly Silver Chart Analysis 7/18

(Chart 1 - Daily Silver)
(Chart 2 - Weekly Silver)

Silver has shown tremendous strength as of late.
The daily chart is starting to look parabolic again.
I expect some selling to occur if we get higher, into the 42-44 area.
However, as strong as this rally looks, we could rip right past it.

From a trading standpoint:
I feel good about buying dips into the 38 area. I would target 42 initially, but would keep some on for 43.75, or 45.30 if you are feeling lucky ;)

Much less confidently, I would also look to sell the 42-43.5 area if we hit it in the next 2 days.

For both of these though, I would first look for 60 min candle confirmations, (hammers/shooting star or engulfing patterns) before entering a position.

Thursday, July 14, 2011


The USD/CHF daily chart to our left by request. This pair has been in a very well formed downtrend for quite a while. So the chart on the left at first glance is confusing but I will try to clear it up, I wanted to show how well formed this trend has been. The light blue retracement starts us out as this downtrend starts in early-mid Feb. After selling off to .9 we retrace almost exactly to the 50% level (shown in light blue). Drawing an extension of that move off of the 50% retrace, our next move lands between the 78% and 100% extension levels. We then retrace exactly 50% of this down move (shown in purple). Drawing an extension off this retracement level, we see that we land almost exactly on the 78% extension. After that we pull back almost exactly to the 38.2% retracement (shown in yellow). We go sideways for just a while which was a little unusual but finally break new lows just a couple days ago. With all this being said, I could see this most recent hammer off nearly the 78% level being a reasonable entry spot. On the other hand if the hammer is not confirmed, I would look for a signal between the 78% and 100% extensions, right around the .80 psychological level. I would think a signal there would produce a retracement of at least 38% or maybe more as it seems this trend is compressing slowly.


By request I have the GBP/NZD daily chart to our left. We are currently breaking new all time lows as it goes and I dont see a whole lot of support anywhere. I've drawn a fib extension from the last time there was any momentum upwards, and we are close to approaching the 100% extension. This also is very close to a psychological support level at 1.9000. This whole down trend since early May has been done with the MACD sloping generally upward creating some divergence (outlined in green). It looks like it is just slowly drifting off with no where to settle or bounce off. We seemed to have formed a nice hammer today and possibly this is a sign we might get a retrace, but I would wait for it to validate by breaking the highs of the hammer.

Wednesday, July 13, 2011

Deere & Co (DE) **REQUEST** 7/13

By request, here is the daily chart of the deere company (DE) to the left. Right now it looks like it is in the 1st-2nd SD area of its regression channel (shown in green) of the most recent down move from its highs. It also held its first retracement (@86.5ish, shown in yellow) quite well recently and that is always something you want to see in a healthy trend. I think that we should expect to see a reaction at the second standard deviation green line if we are to continue lower, and would especially want to see us get below the 1st deviation soon. I think ultimately at this point its a sell, but it would be invalidated if it closes above the 2nd SD / first retracement lines.

Tuesday, July 12, 2011

EURUSD at Good Spot to Sell? 12:45 PM CST 7/12

Here is a 60 min chart of the EURUSD future

Opened the week at 1.42, sold as low as 1.38 at night, now we are back at 1.40. You don't have to be a rocket scientist to figure out that it has retraced 50% of its move at this point. Combine that with some resistance just above 1.40, and further combine that with some high wick low body candles indicating selling in this area, and you have a compelling case to sell.

I sold 1.40 with a 1.41 stop.
My conservative target is 1.3775
Aggressive target is 1.3625

S&P (ES) Retracing 7/12

To the left is the hourly chart of the S&P futures and below is the weekly chart. In the hourly we can see that we broke the key level of 1300 overnight only to spring back. It looks like we are in the middle of a retracement that might be stalling out here as we hit the first level. There has been a healthy pullback in the MACD histogram as well and while there is no real indication this level will hold, I think that we will see this head lower in the next day or so. The second chart is more of an update on a post earlier about a potential head and shoulders setup for ES on the weekly chart. Last week finished well for this setup and this week has started out with a bang as yesterday saw quite the sell off. I think more and more we are confirming this setup and the next test will be at the neckline around 1255 level.

Good Entry to Sell WTI Crude? 9:25 AM CST 7/12

Here we have a 15 minute crude chart.

Crude is back at its 95 resistance.
The last 15 min bar was a strong shooting star right off of the resistance.

We also have hidden divergence with the MACD and price (see the white sloping line on MACD and price) which is confirming this peak might be a peak.

Further confirmation is the relatively high volume that bar had as well.

I sell here (95) stop at 96 and target 92.25

EDIT: Stopped out for .2% of account lost. Will stay on the crude sidelines for now

Gold Triple Top with Strong MACD Divergence. Sell? 6:55 AM CST 7/12

Gold looking very toppy right now as the USD continues its tear to the upside.

Since Jun 6th, Gold has formed 3 separate shooting star reversals at the highs of the range (1550-1560). Each of those peaks have been confirmed with a lower and lower MACD value each time (see downsloping white line on MACD).

Couple a triple top, with strong MACD divergence, and thrown in that it is at the top portion of the channel it is in (light blue), and gold smells like a good risk reward for a sell here.

I sell here (1550) with a stop of 1565 and a target of 1505 (45:15 aka 3:1 reward:risk)

EDIT Stopped out

Friday, July 8, 2011

Silver (SI) Selling Opportunity 7/8

After getting long silver (mentioned in a previous post) from nearly the lows of this recent move, I think it might be time to get out or reverse positions. To the left is the hourly chart of silver, and while you cannot see where the yellow fib retrace is drawn from, its from the highs in late May around 38.845 to our recent lows around 33.405. As you can see this level coincides with a peak already formed on 6/22 and today we just pierced this deep retracement again before bouncing off. We have also been forming quite a bit of divergence (shown in green) over the last 3+ days. This divergence is also apparent in the 4 hour chart and I think its a good indication this run up is about to die and as silver can do, we might be heading for a steep fall soon.

EUR/USD Triangle 7/8

The euro 4 hour chart to the left, and it looks like over the last two months we have been forming a slightly descending triangle (shown in purple). Over the last few sessions we've been forming divergence with the MACD histogram as price has gone lower today with the histogram way up from a few days ago. With the triangle sloping down I would usually see this as a eventual breakout downward, but seeing as we are at support and have divergence I would possibly make a long play to try to get up to the 1.44-1.45 level before eventually looking for a signal to go short.

Thursday, July 7, 2011

Natural Gas ETF (UNG) Channel Break **REQUEST** 7/7

To the left is a daily chart of UNG, a natural gas bullish ETF. We can see that back in the late part of last year and early part of this year we were forming a bullish channel (in yellow) that eventually broke hard to the downside. After making some new lows it started back up into a bullish channel (in green), but this time a little less dramatic of an angle on the channel. I think I might of missed the boat on this trade as it seems to have already broken out, but still might not be a bad trade if there is any pullback to get in.

Wednesday, July 6, 2011

Dolemite out until next week

Flattening up and heading out of town til Sunday
Sandwich will be posting updates when he gets time

Good luck and see you all next week.

Treasuries (TLT) Ready to resume trend 7/6

To the left is a daily chart of the ETF TLT which is basically bullish the long end of the treasury curve. The chart is a little messy so it might take a second to look at it, but basically we can see the retracements from the lows at 88.14 to our highs at 97.74 (in purple) and the retracement from 89.65 (low peak in trend which also produced a sub 0 MACD reading) to our highs again (in yellow). We can see price is just in the area where two levels from these retracement form a confluence at the 93.7-94.07 levels. We also notice that this area is the highs of the 3/16-3/23 date range. On 6/30 it put in a pretty good hammer through these levels and that hammers tail has held so far and today we start to break above its high. We can also see the green line which shows a trend of the lows matching up with the low peaks in the MACD histogram below. We are again seeing continuation divergence between price and the MACD as this ETF had seen on 4/10-4/11. I think this is a pretty good spot to get in on this trend and hopefully a ride to new highs.

Platinum (PL) Finding Resistance 7/6

To the left is a 4 hour chart of Platinum (PL) futures. It looks like it has run into a confluence of retracements (shown in yellow and purple) around the 1751-1758 level and showing some high candle wicks running up to those levels. It also has formed some divergence with the MACD between its peak on 6/29 with its peak overnight as shown in green. With price already reacing off this level and the divergence, it might be a little riskier just to jump in, but I think its worth a small shot as we could be heading below 1666.

Russell 2000 Looking Weak. 9:11 AM CST 7/6

(Chart 1 - Russell 2k Day Chart)

SNP still looks pretty good
Nasdaq certainly doesn't look weak
Russell 2k is generally a leading indicator, so it is no surprise that if weakness shows itself, it would show first in the Rus.

Since the high at the beginning of May, we have been making lower highs and lower lows.
This most recent run up has been pretty epic and strong.
However, we are still lower than the last peak.

Halfway through today, there is a nice bearish engulfing candle forming.
It happens to be forming off of 84.20, the bottom of the trading range, and a line of great resistance.

We also have the beginning of some hidden MACD divergence (white sloping lines)

If this keeps up, I think this could be a decent sell with a 78.20 target

BestBuy (BBY) **REQUEST** 7/6

Best Buy's daily chart to our left, it looks like we are starting to form a descending wedge (shown in yellow) since about the beginning of the year and after its giant sell off (not shown) previous to the end of the year. I think this could also be a low risk sell at this point to try to ride it to the other line as it seems like we are showing a small bit of divergence in the MACD. I would also think this could be a good straddle play sometime in the next months if we continue to squeeze into this wedge.

Microsoft (MSFT) **REQUEST** 7/6

Microsoft daily chart to the left and I can see a possible selling opportunity coming up. It looks like we are approaching a confluence of fib retracements at the 36.6/36.7 level (shown in purple and yellow). We also are showing a good bit of continuation divergence as the MACD pulls back considerably while we still are yet to really break a new high peak in price. I would wait for a signal of some type as I wouldnt want to catch a falling knife (or rising knife in this case). The only hesitation I have about this trade is that 23 is the lower end of its range in about forever so the profit target wouldn't be great, but still something could be made from this.

Silver Overbought and at Resistance. 7:55 AM CST 7/6

(Chart 1 - Silver Daily Chart)

I posted here over the weekend that silver would head up, but stall at the top of this magenta channel.

So far it has done this.
Halfway through the day, 35.94 is proving to be strong resistance.
Not a bad place to sell here with a 32.80 target.
Stop if it closes over 36

Tuesday, July 5, 2011

S&P (ES) Head and Shoulders 7/5

To the left is a weekly chart of the S&P (ES). It might be a little early, but it looks like we could be forming a head and shoulders pattern. While this could easily be invalidated by weeks end with a weekly close near 1350 or so, I think at the moment it is looking good. If we see a week that closes near 1335 or lower I think we could be heading to the neckline shown in green and a possibly valid H&S pattern completion. The volume has been near the lows as appose to the highs which all show relatively light volume. We have also seen divergence with the MACD throughout the formation. I think a sell here could be low risk, or a sell if we break the neckline. The ultimate target would end up being around 1150 for this pattern, but more on that if this pans out over the next week or two.

Monday, July 4, 2011

WTI Crude Oil Analysis 9:00 PM CST 7/4

(Chart 1 - WTI Crude Daily Zoom)
(Chart 2 - WTI Crude Daily)

Amazing that a line drawn between 11/17/2010 and 02/15/2011 would be relevant on 06/27/2011, but it was. This line is the low line of the bullish channel (light blue) drawn on the daily chart. Price broke out of this channel when it gaped up on 02/23/2011. After the May/Jun 2011 crushing, we got back inside it, and the recent low fell right into the low line, as we failed there, headed higher, and still haven't really looked back.

With this snapback rally of the last week, we are now also back inside the dominant bearish channel (magenta) as well. The current trading range is defined as 92.22-95.14.

With all of this out there, here is my analysis:

Price is very fair here according to both channels, and is neither overbought or oversold.
The upper wicks of the last 3 sessions (as well as this current one), suggest that the upper bounds of the trading range are being respected. Until we close over 95.20, I think crude can be sold with a target of 92.25. I would rather not touch it though, see what way it moves, then trade it from there.

Here is the "Crude choose your own adventure"
1. We respect 95.20 and head lower
- If we do this sooner rather than later, the low of the bearish magenta channel and the low of the trading range should support the selloff and attract buying. All of this being said, the light blue uptrend line, should still be considered the be all end all ultimate support for any buying.
2. 95.20 resistance does not hold and we head higher
-Even if number 1 occurs and we head lower, once that sell off is exhausted, the following analysis still holds. I expect crude in the next 2 weeks to close above 95.20. July 20th presents an interesting set of circumstances. On that day, $100, the top of the bearish magenta channel, and the top of the bullish blue channel will all align. This is extremely powerful, and any move into this range around that time should be sold with good confidence.

Silver to Move a Bit Higher Before Next Selling Opportunity. 8:30 PM CST 7/4

(Chart 1 - Silver 60 min Zoom )
(Chart 2 - Silver 60 min)
(Chart 3 - Silver Daily Zoom)
(Chart 4 - Silver Daily)

Lots of charts. Lets get to it!

60 min silver shows that 33.80 will be a strong place to buy for the immediate term.
It is the top of the current lower trading range (33.40-33.77), as well as the deep 62% fib of the most recent up move (33.80).

Should this buy zone be violated in the next few days, 32.80 should provide very strong initial support

Any run up into the upper trading range (34.97-35.34), should be met with strong selling, as in a few days, it will also coincide with the top of the governing bearish channel (magenta on all charts)

Right now we are in the middle of the channel. "Master the Markets" VSA(volume spread analysis) says that the bottom quarter of a channel means it is oversold and the top quarter is overbought. I would like to see it more overbought/sold near probable support/resistance before I take any serious position. (p.s. if you aren't familiar with that book "Master the Markets," pick it up... highly advised for any trader)

Sunday, July 3, 2011

SNP Start of the Week Analysis. Preopen 7/3

(Chart 1 - SNP Daily Zoomed)
(Chart 2 - SNP Daily)

Wow, what a short covering rally. Every day took out resistance after resistance, as the shorts fell over each other to get out of their positions and start the long weekend.

That being said, it is now approaching a likely stall zone.
1345-1350 (in the september snp mini future contract on the CME) is setting up to be an area of superior resistance.
1347.5 is a 5/8 M.M. line and the top of this sector's trading range.
We also have the low of an old and very strong bullish channel (light blue) that we broke out of on Jun 1st. If we rally into it, it should provide a good place to sell.

As you can see, both of those intersect for the Monday session.
I anticipate we will rally into it, and probably past it a bit.
When we get near it, look at 30/60 min charts for price action to indicate strong selling is indeed occurring at these levels (shooting stars, bearish engulfing, etc). If it is, I advise getting on board.

Friday, July 1, 2011

Precious Metal Long opportunity 7/1

To the left are 4 hour charts of both gold and silver futures (GC & SI). It looks like both charts are starting to form hammers off of previous low peaks (not exactly but close). along with both of them showing some good divergence, especially in gold. I think this could be a good time to get in on these and I finally found a play I like after most stuff has been going against its recent trend and not much opportunity to get in. Contrary to popular belief, we have not quit the blog, but when I don't see good entries or spots I like, I tend to just not post as appose to spew BS about indecisiveness. So if you see little activity on the blog its probably cause the market is choppy or starting a new trend and I dont see a good entry spot.

Tuesday, June 28, 2011

Dollar Index (DX) Important Support 6/28

I figured instead of posting on the euro and stocks and anything else I would just post on what seems to be driving them all at this time. Right now we have just cracked some important support in the dollar index formed by the retracements of the most recent up move (shown in purple) from last week and the up move produced from our lows at 73.665 (shown in yellow). We can see that we are getting a confluence of support between fib levels around 75.516-75.463. We spiked below this brifely and are now sitting just at the lower side of this zone. Whether or not we hold this level I think will ultimatly decide where most markets end up. The most recent spike down has formed some divergence as there was not much move in the MACD on the spike. While the dollar has not made new highs, it has for the most part been making higher lows seen in this chart, and it looks like it is building momentum to break to the upside. If we see a strong break of this current support I would not be short too many markets priced in dollars and would look to 74.845-74.755 for the next major support level.

WTI Crude Oil Rejecting 92.25 Key Resistance. 10:05 AM CST 6/28

(Chart 1 - WTI Crude 60 min)
(Chart 2 - WTI Crude Daily)

92.25 is a very important level. Today we rallied into 92.19 and couldnt get over it.
Last few hrs on the 60 min chart have very long upper wicks on the candles when it gets near 92.25, indicating continued selling interest at that level.

On the daily chart, 92.25 is also near the low line of the old bearish channel we were in (magenta channel).

I shorted oil here and look for a move back to 90 initially and ultimately a target of 87.50 is very feasible.