In the past few months, XAU traders have experienced some volatility, with gold prices falling to a low of $1820 at one point and rebounding to a historic high a few weeks later. This year, orders with the right direction and timing will surely make some XAU traders smile, but if you have not yet held gold orders below 1900 points or can only trade within the current volatility.
In contrast, despite political and economic turmoil affecting all markets, USOIL has repeatedly stepped out of the trader's dream market. The existence of short-term and long-term reversals provides many options for investors and intraday traders. However, is oil trading easy, is the risk high or low, or is it only suitable for professional traders?
You may be surprised to find that you don't even need to understand technical analysis to trade oil. Let's take a look at why.
USOIL is very suitable for traders of all levels. In fact, you don't even need to use the most basic technical tools to grasp the trend of oil prices. Let's take a look at the chart and see why traders of various strategies choose USOIL.
The price follows a very regular pattern from high to low and then returns again. If you are on your browserOpen USOIL chartYou can immediately see this rhythm. In the short-term price range, a beautiful scene of uneven high and low points can be seen.
The price fluctuation is small and stable, ranging from approximately $4 to $6 from high to low, and occurs every day whether it rises or falls.
Then there is a mid-range fluctuation of around $9 to $16, which also applies to both upward and downward scenarios. If traders seek to buy low, hold, and then sell high, they can pay attention to the mid-range volatility, which occurs on average every two weeks.
There is also a rhythm with a lower frequency of occurrence, which usually triggers huge waves once it appears. This rhythm is more suitable for long-term traders who only want to buy and hold at low prices, or sell at high prices and wait. In the past 5 years, USOIL has repeatedly shown a long-term overall upward trend, followed by a sudden and violent reset. In these large reset markets, prices have dropped by as much as $50. Anyone who dares to short oil during these cycles can make a big profit, but trend traders who follow a slow upward trend will suffer a complete defeat.
The rhythm of this theatrical variation is almost unpredictable, but it can bring the most outstanding effects. The best way to predict such situations is to use fundamental market news such as OPEC production cuts or supply and demand issues. Please remember that after news breaks, the market usually experiences a small-scale response first, followed by a few weeks before a large-scale response is made.
If you want to seize a major price change, you may need to buy and hold (for approximately several months). Now look at the chart and see when the last major fluctuation was. The next major market trend may be brewing right now.
A strategy that doesn't pay attention to timing is like a car without a key. Let's take a look at the strategy together, but you need to choose the right time for your entry point in order to fully utilize the volatility of crude oil.
Now let's look at the chart together. Set the time period to 4 hours (top left of the chart), click on the icon on the right to switch the K-line chart to a line chart. Now you can see the wonderful ups and downs of peaks and valleys. You will also see some Pingdingshan peaks, and occasionally you can observe drastic price movements. Let's look at the right side of the chart and see the current trend.
Is the current price going up or down?
Go back to the previous high point and check the price. If the price behavior maintains a consistent style before and after, it means that one of the following three price behaviors may be the current price pattern. Minor price behavior, mid-range price behavior, or severe seasonal fluctuations. One of the behaviors is interpreting oil prices.
Check the previous price high point and predict where a small or mid-range volatility will likely end. These two points are two potential entry points that can be considered. If you see the formation of a valley at the expected location, you can consider the next reversal.
If the result is a seasonal price trend, then the decline cannot be predicted by anyone. So if you happen to place a buy at a small or mid-range prediction point, be sure to use Exness' stop loss function to protect your funds.
USOIL rarely experiences price surges or rapid rebounds, but they do happen from time to time. If such a trend is observed, a well considered buy will bring you a very pleasant surprise at the end of the day. But let's still focus on other more common pricing behaviors. Trace back to the most recent trough and add a small or mid-range wave amplitude. These are two potential reversal points that can be considered.
For example, if USOIL shows an upward trend around $82, then a small price action points to the $88 level, which is the entry point to short or sell USOIL. If the volatility is a mid-range price behavior, the price will continue to rise to $95 before reaching resistance level.
Whether the price is trending upwards or downwards, your goal is simply to observe the chart and wait for a reversal at small or mid-range price behavior points.
Whether you want to offset the constantly rising oil prices at gas stations or are considering trading USOIL within days/weeks, Exness can meet all your needs. Exness can provide protection functions that can buffer price drops, as well as low trading costs that can increase potential profit margins during strong rebounds.
Like all other popular trading varieties, when trading USOIL, you need to obtain first-hand information, so please installExness trading applicationGet real-time notifications of market changes. New influencing factors are emerging, so these patterns may be disrupted.
Please make sure that yourExness accountBe active and have sufficient funds to ensure that your transactions are not delayed. But at the same time, please be patient and only trade when you have sufficient confidence. If you miss a good opportunity, there is no need to feel regretful about the fact. There will definitely be opportunities in the future, and if we focus on USOIL, we believe that opportunities will come soon.