Crude oil made a nice run higher in August. It launched from the $39 area and ran all the way to the HVA (high-volume area) resistance zone located at 47.75 – 49.47. The rally was stopped in its tracks once it hit this this resistance zone that was defined by the volume-at-price information established in the two prior months.
Click here to watch a video explaining how to read markets using volume at price.
After several days of persistent testing of this zone, buyers became exhausted and sellers gained the upper hand. Sellers forced prices lower until they reached the HVA support zone at 41.10 – 43.39. This zone of support was established weeks ago and defined by the volume-at-price information from early August. Upon touching this HVA support zone, the decline was arrested and crude oil made a sharp bounce.
The bias in crude continues to be for rotational price action with well-defined zones of HVA support below and HVA resistance above.
