WTI Crude Oil (1D): $106 Breakout & Textbook ABC Impulse
Title: WTI Crude Oil (1D): $106 Breakout & Textbook ABC Impulse Toward $120+ 🛢️🚀
🧠 Fundamental Overview (Geopolitical Spike & Macro Supply Shock):
WTI Crude Oil (SPOT) has exploded higher, pushing past the critical $105–$106/bbl threshold to trade at its highest levels since early May. The rally is heavily backed by severe supply disruptions and escalating geopolitical tensions:
Geopolitical Escalation & Supply Risk: Following renewed drone strikes in the Middle East that shut down critical infrastructure—including Saudi Arabia's East-West pipeline—and intensified maritime friction around the Bab al-Mandab strait and the Strait of Hormuz, the supply risk premium has expanded aggressively.
Inflationary Spillover: As highlighted by The Kobeissi Letter, U.S. crude prices are up over +57% since July 2nd , pushing average retail gasoline prices up to $4.33/gallon . WTI is now sitting roughly 13% away from the peaks reached at the onset of the conflict, directly stoking global stagflation and interest rate worries.
https://www.tradingview.com/x/KoN6vuYv/
📊 Technical Breakdown (1D Timeframe):
On the daily chart, price action is unfolding a textbook bullish ABC impulse off the multi-month ascending baseline:
1️⃣ Confirmed ABC Wave Structure & Dynamic Reclaim:
After an initial impulse to the $102.45 peak (Wave A), the corrective Wave (B) bottomed within a deep retracement between the 61.8% ($91.97) and 78.6% Fibonacci levels, briefly testing the rising macro Trendline B around $75.22. From that floor, the market triggered an aggressive Wave (C) expansion that cleanly sliced through the 50-day EMA ($88.35) , the 200-day EMA ($82.22) , and descending Trendline A —a dynamic diagonal ceiling that had contained every rally attempt for months.
2️⃣ Volume Expansion:
The last two daily sessions have recorded a noticeable volume spike (reaching ~86.97k ticks), proving heavy institutional participation driving this breakout rather than a low-volume liquidity squeeze.
3️⃣ MACD Convergence:
The daily MACD exhibits total directional alignment with price action—printing expanding green histogram bars and an aggressive bullish crossover without showing technical overbought exhaustion yet.
4️⃣ Fibonacci Extension Targets:
Target A (1.618 Fib Extension / Macro Ceiling): $119.40 – $120.00 USD (Direct confluence of the 1.618 Fib extension and the previous macro highs).
Target B (2.000 Fib Extension): $129.88 USD (Full measured impulse expansion).
🎯 Conclusion & Trading Strategy:
The technical structure is decisively bullish, pointing straight toward the macro resistance block at $120 USD.
However, from an execution standpoint, chasing fresh long positions right here at $106.75 means entering late with unfavorable asymmetry. The optimal entries were either:
Aggressive Entry: Directly in the 61.8%–78.6% Fib reversal zone ($75–$78).
Conservative Confirmation: On the breakout above both EMAs and Trendline A around $83–$84 USD.
At current levels, price is only about 10% away from its major macro target, while the downside exposure on a sharp mean-reversion is wide. A local pause or corrective pullback near the intermediate $109–$110 supply zone to digest gains would be healthy before attempting the final push to $120. If such a pullback occurs, watch closely for fading volume and potential oscillator divergences to gauge whether it is a continuation flag or a deeper reversal.
Are you trailing profits toward $120 or looking to short the extension? Let's discuss in the comments! 👇
⚠️ Disclaimer: This analysis is strictly for educational purposes and intended solely to intellectually enrich our trading community. It does NOT constitute financial or investment advice. Always perform your own research and manage your risk strictly.
TITradingView Ideas15 Sept
