Does our LIS hold? Weekly CL Trade Idea

CL1!

Macro Update:
There are a lot of market moving events taking shape on the macro landscape.
Peace negotiations between warring countries, reciprocal trade tariffs, and a US-Iran nuclear deal.

We need not mention that any of these events may potentially turn market sentiment risk on or risk off. It all depends on how these all unfold.

On the economic front, we have rate decisions from various central banks. Most central banks reiterate cautious cuts and turn hawkish amidst concerns about the rising inflation outlook. Central banks are also pointing towards rising uncertainty on the outlook itself as we mentioned above. It all depends on how events unfold.


WTI Crude Oil Big Picture:



Viewing a weekly full session WTI crude oil chart, we can see 3 weeks of one time framing up on the weekly chart starting Dec 30th, 2024. We then saw a rejection of uptrend and prices reverting to 2024 Value area. We can see four bearish weekly candlesticks from the week starting Jan 20th, 2025. Last week, the price action on the weekly timeframe formed an inverted hammer showing bearish pressure increasing on WTI crude oil. Our key LIS and key bull support show the confluence of multiple market generated levels has held up for the past 3 weeks.

Traders take note that WTI crude oil futures contract has rolled over to April 2025 contract. Symbol: CLJ2025
In addition, DOE WTI inventory numbers will be released on Thursday 11am CT due to US President’s Day on Monday February 17th, 2025.



Key Levels to Watch

Key levels represent areas of interest and zones of active market participation. The more significant a key level, the closer we monitor it for potential reactions and trade setups in alignment with our trading plan.

2025 mcVPOC: 72.82
Feb 2025 mcVAH: 72.48
2025 mcVAL: 70.56
Yearly Open/ LIS: 70.52
Key Bull Support/ Confluence Zone: 70.52 - 70.12

Scenario 1: Range bound week ahead
In this scenario we expect range bound price action contained within Feb 2025 micro composite Value Area.

Scenario 2: Risk-off sentiment shift prices below key LIS
In this scenario, we may see a breakdown of our key bull support and Line in Sand. Price moves and stays below yearly open price, providing a possible shift lower towards composite volume point of control (CVPOC).


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