• 4 minutes Why Trump will win the wall fight
  • 9 minutes Climate Change: A Summer of Storms and Smog Is Coming
  • 12 minutes Maduro Asks OPEC For Help Against U.S. Sanctions
  • 16 minutes Washington Eyes Crackdown On OPEC
  • 15 hours is climate change a hoax? $2 Trillion/year worth of programs intended to be handed out by politicians and bureaucrats?
  • 4 hours Ayn Rand Was Right
  • 2 hours Tension On The Edge: Pakistan Urges U.N. To Intervene Over Kashmir Tension With India
  • 4 hours Oil imports by countries
  • 6 hours Sanctions or Support: Despite Sanctions, Iran's Oil Exports Rise In Early 2019
  • 3 hours Indian Oil Signs First Annual Deal For U.S. OilIndian Oil Signs First Annual Deal For U.S. Oil
  • 3 hours Solar and Wind Will Not "Save" the Climate
  • 1 hour NZ Oil, Gas Ban Could Cost $30 Bln
  • 55 mins AI Will Eliminate Call Center Jobs
  • 18 hours Regular Gas dropped to $2.21 per gallon today
Jim Hyerczyk

Jim Hyerczyk

Fundamental and technical analyst with 30 years experience.

More Info

Trading Support/Resistance: A Lost Art

Trading Screen

Some traders will tell you that March West Texas Intermediate crude oil had a volatile week. If you look at the price swings over a five-day period then yes, there was volatility. If you measure volatility over a 30 or 60 day time period then volatility is non-existent. In fact, I don’t think crude oil has traded more than $3.00 north or $3.00 south of $53.00 the entire year.

So yes, the market has been delivering two-sided price action, but no, it hasn’t been volatile. I think it’s been tradable because it seems to be adhering to clearly defined support and resistance levels. I think the problem for some traders is that they like trending market. They like to play momentum on breakouts because there is almost instant gratification if you’re on the right side of the market.

Trading support and resistance, or buying dips and selling rallies, is a lost art in my opinion, because traders today have demonstrated to me that they lack the patience or the discipline to buy a market that is falling into support or sell a rally into resistance. It could just be that they don’t know how to do it.

The keys to trading support/resistance are to first identify the support/resistance, second, let the market hit the support/resistance, third, wait for the turn on an intraday basis, fourth, then buy or sell in the direction of the move.

If you used this technique this week while trading the March WTI crude oil futures contract then I think…

To read the full article

Please sign up and become a premium OilPrice.com member to gain access to read the full article.

RegisterLogin



Oilprice - The No. 1 Source for Oil & Energy News