The Chart of the Week is UCO.
I cover /CL (crude oil futures) on my YouTube Morning Monster livestream every day. ← you should probably subscribe!
UCO is a leveraged ETF and one of my favorite ways to play moves in crude oil.
UCO had a nice move up off the early summer lows but then abruptly found a top in September.
/CL has a somewhat perfect “measured bounce” in place. The measured bounce is my favorite — and often the most explosive — Fibonacci pattern.
UCO has a little less perfect “measured bounce” setup in place. UCO has a Market Roadmap bounce in place and is breaking up through the RML* on the daily chart.
I see a SUPER aggressive entry right now on this break above the RML.
A bit more conservative, but still quite aggressive would be to wait for the gap fill near $32 on UCO.
A much more conservative entry would be to wait for UCO to move above $34.50.
This pattern has a fairly sizable downside to around $20 before it becomes completely invalid. (plan accordingly as leverage can cut both ways)
The conservative target on this move would be a return to the high of $37.
Then we climb the Fibonacci ladder higher to progressively more aggressive targets of $39, $42, $44, and then finally the big picture bullish target of $48 from which (if we get there) we might see a pullback and get some nice continuation to even higher targets.
Each of these target levels can act as resistance and may result in a retrace to a prior level of former resistance which has turned into support.
You can go check out my chart marked up with notes (entries, targets, etc) right here: https://www.tradingview.com/x/w7JdnTxG/
— Jeffry Turnmire