Heating Oil futures held key support in Tuesday's session as the broader energy complex continues to benefit from rising tension in the Persian Gulf. The modest rise formed a swing low to complete the most recent leg of a large Rising Wedge chart pattern, identified here on the Autochartist 240-minute time frame.
This Rising Wedge chart pattern is now well-established, registering an Initial Trend reading of 10 bars. The overall Quality ranking is 8 bars, and Clarity and Uniformity readings may improve as the pattern approaches completion to make this a strong candidate for establishing market direction in the longer term.
As long as the trend line support provided by the wedge holds at the last swing low, the price is expected to rise to the upper resistance band between $3.05 and $3.07 per gallon. This would complete the next leg up and position the market for a breakout towards new highs. Given the wide price range between the top and bottom of the wedge, range-bound trading within the pattern could also continue well into next week before a decisive breakout occurs.
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