Crude oil took a dive out of consolidation last week falling down aggresively, and finally found support last session.
When the bulls entered back into the market, they closed the day as a bullish rejection candle, with a closing price that was higher than the open price – which gives the setup a bit more bullish authority.
The market is also over extended from the mean, which supports the idea of a mean reversion trade. This setup has already offered a retracement entry for price action traders and is now looking like it wants to continuing pushing up off the support level.
Traders who want to trade with the bearish momentum can wait until a retracement does occur, then target any sell signals that do form off the old support level. This would make a ‘breakout & re-test’ kind of structured swing trade.
javifx
in this example the mean could be a level below if the case arises?