Crude formed a 3 day 1-2-3 bottom, marking the end of a 5 week downtrend, and subsequently breaking out on the 7th of August. The 2H candlestick that signalled the breakout was part of our Bullish Setup 3 - Big Green above Resistance forming at C4. The breakout from a strong bullish reversal pattern after a significant decline added conviction to the trade. The price rallied higher for the better part of the day.
The next day, the price action formed a flag pattern in the first half of the day. C4 formed a Triple Falling Bottom - our Bullish Setup 6, indicating an imminent breakout from the flag. Price rallied significantly higher for the rest of the day.
Lets look at the chart which has annotations that are self explanatory.
Bullish setups on 2 consecutive days on Crude Futures on 7th and 8th Aug, 2024
The above example demonstrates the high probability of success for trades that coincide with a chart pattern breakout - on the day of the breakout and the next day.
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