I am going to treat this as a blog space for coil-watching for a bit... Here is todays chart:
http://bp0.blogger.com/_5h-SWVGx6Ms/...oil+Break3.bmp
Note the differences in the 2 drawn rectangles. The second one is the one to remember to look for -- you have a triangle type of pattern at that point and you have low 5-min ADX -- the market has lost volatility and coiling for a potential trending move.
Today was a lower volume NR-7 day so not the best trading environment. I did try a short near point C on the chart and stopped out for a small loss. Note the magenta circle signals the failure of the a-b-c corrective pattern. There was a test down out of the abc up pattern that led to a 'higher low'.
Note that this was a 'bear trap' below the
VWAP level -- similar to yesterday -- failure to trend in one direction after a coil break gives fuel (short-covering) for a move in the other direction. I did go long above the
VWAP level and caught the quick move up. Thus, the small loss enabled me to catch a downside move, if one developed -- but the failure of that pattern enabled me to catch a good move up.