June/July Volume Dilution In WTI Crude

Posted Thursday, May 16, 2019 by
Shain Vernier • 1 min read

June WTI crude oil futures have broken out to the bull and gained traction above $63.00. Bidders have entered the market en masse, going long ahead of the pending July rollover. At this point, the volume split is 2/1 in favor of June, but energy traders will likely make July the new front-month WTI contract on Friday.

June WTI Crude Oil Futures Have Broken Above Fibonacci Resistance

For the better part of three weeks, June WTI crude oil futures have rotated between $60.00 and $63.00. This morning has brought a break from this area, north of the daily 38% Fibonacci Retracement ($62.55) and Bollinger MP ($62.40).

June WTI Crude Oil Futures (CL), Daily Chart
June WTI Crude Oil Futures (CL), Daily Chart

Here are the levels to watch for the rest of today’s session:

  • Resistance(1): Daily SMA, $63.91
  • Support(1): 38% Current Wave Retracement, $62.55

Bottom Line: The bullish breakout in WTI has been a long time coming. In the event it reaches the Daily SMA ($63.91) an active short from this area is a solid way to fade the intraday trend. For the rest of the day, sells from $63.89 with an initial stop at $64.11 will likely produce a fast 10-15 ticks profit.

Remember that the July WTI futures contract is very likely to be the new front-month for Friday’s session. At press time (12:00 PM EST), July WTI is trading at a slight premium over June. Look for this spread to come in as the Thursday session progresses and Friday gets underway.

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