Yesterday I said that USO looked ready for a pullback, not a bearish pullback, but a bullish one that will stop USO from becoming overbought and allow the trend to continue up in a neat manner.
However, the 3C cycle in USO is very much what I'm going to be looking for in the market as I just posted, here's what it would look like.
Yesterday's daily closing candle in USO is a Doji which is a reversal candle. Most often these candles are confirmed the next day as reversal candles with a gap up which we have seen this morning and then a close lower then yesterday's which would be represented by the white extension I attached to today's candle.
The 1 min chart is very negative and didn't react to the gap up at all, but this is just the final stage for the 1 min chart.
Note the approximate 2 days of a negative divergence on this 5 min chart INTO higher prices, this is what distribution looks like, selling into demand to get the best possible exit price.
And the 15 min chart is usually the last chart where we expect a negative divergence before a reversal, it also has about 2 days of negative divergence into higher prices.
This is similar to what I'm looking for in the market averages as I noted in the last post.
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