How to Trade an Uptrend
Up oil trend is when the crude crude oil price of a oil chart is moving higher & higher. Oil prices generally close higher than where they opened.
How to Trade Upward Oil Trend: Oil traders use the upward oil trend direction to open buy oil trades
Drawing a Oil Upward Oil Trend Line
When the oil market moves up it forms higher highs & higher lows forming a bullish market movement - upward crude oil trend. An upward oil trend line can then be drawn by connecting these higher lows of the crude oil price.
To draw this upward oil trend setup we use support levels. To draw the upward oil trend line correctly two supports are needed. When crude crude oil price touches the upward line we open buy crude oil trades and place stop loss just a few pips below the upward oil trend line. The upward oil trend line below shows an example of this upward crude oil trend.
Strategy for Trading a Oil Upward Oil Trend - Drawing a Oil Upward Oil Trend Line
The upward oil trend setup will show the general direction of the oil market as bullish therefore oil traders will only open buy long trades as long as crude crude oil price is within this oil up trend setup and within the support levels.
These support levels are the levels where if the oil market retraces then this support points will provide strong supports for the crude crude oil price. This is why many buyers will wait until crude crude oil price retraces downwards & hits these retracements levels on the upward oil trend line to open buy crude oil trades. Trades opened at these levels have a high Risk: Reward Ratio and have little drawdown.
In the above setup the oil trader would have opened buy crude oil trades form the oil signals generated at the support 1, support 2, support 3 and these buy crude oil trades would have been opened with minimum amount of draw-down/retracement.
Upward Crude Oil Trading Channel
A oil channel is drawn by drawing a line that is parallel to the upward oil trend line and then adjusted to touch the top boundary of the crude crude oil price movement. This then forms a channel - upward channel & as long as the crude crude oil price stays between these 2 channels the bullish market oil trend movement will continue moving up.
Upwards Oil Trading Channel & Upwards Oil Trend Trading Strategy
Trading The Upwards Crude Oil Trading Channel
This upwards oil channel is used by crude oil traders to show levels where it best to take profits. Oil traders will take some profit once the crude crude oil price touches the upper channel and wait for another retracement before opening a buy oil trade again.
