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Nice job gary -- the only thing to watch for is when equities open at 9:30, I would suspect there may be an attempt at another selloff, but that will depend on where we are in a half hour.
2) I waited for the price to confirm resistance and then return to confirm support.
3) I watched for volume to tell me that my support was in the right area.
4) I waited for a trigger, which today was strong divergence on the 9 range and a reversal on a 6 range.
This move may have a long way to go. There is a lot of arguement for support zone #2 being reach today, and I will be watching for it, but for my personality I prefer to get in and out as the wave moves along.
I am going to. I am more interested in the 10:30am EIA. We could see a retest of support.
Think about what just happened over the past 48 hours. Crude ran up and up, until most shorts were out. It reached an area of defined resistance, and so when it started to turn there, the long positions started to exit to lock in their profits. The trend was up, but new positions were going to wait for support before they got in, so price just fell and fell. Meanwhile, new short positions had entered the market at the resistance area, and when they saw that support might hold (as indicated by the volume), they wanted to lock in their profits, and so the cycle reversed.
Where crude goes longer term is tougher for me to read, but short term, the above scenario makes sense to me, which makes it easier for me to trade.
This 9 range shows before the trade there was significant divergence. I turned on the trade markers to show the entry and exit, which was the next move down after the divergence.
While I wait for EIA, here is another shot on a 6 range. This is a favorite of mine for being very visual and easy to look at.
I entered on the DC when the bars turned white (after confirmed support, white by itself means nothing). I exitted when price hit the 786 area. Could not explain why, other than I knew the EIA was today, and we just had a big move down overnight.
As was suspected, price did return to the support area for a retest. Watch for a possible double bottom to form in this area. On a higher timeframe, this zone is significant.
I had a conference call and missed the EIA timing, but wanted to post the result of the double bottom in the support zone. It would have been a great trade, but there will be plenty more.