Crude Oil Futures Analysis for February 25, 2025 โ tradeCompass
At the time of this analysis, crude oil futures (CL) are trading at $71.05. Todayโs TradeCompass strategy remains open to both bullish and bearish scenarios, depending on whether price crosses key thresholds.
๐น Bullish Outlook
TradeCompass will only turn bullish above $71.63, which would place price:
- Above the Value Area Low (VAL) of February 18
- Above the Value Area High (VAH) of February 14
- Well above yesterdayโs VWAP close and todayโs current Value Area High (VAH) at $71.25
This threshold is critical because crossing above it would indicate that buyers are in control, increasing the likelihood of further upside.
๐ฏ Bullish Profit Targets:
- $71.77 โ Below February 18 POC, aligning with the Value Area High of February 6.
- $71.86 โ Just under yesterdayโs first upper VWAP deviation.
- $72.19 โ Below Value Area High from two days ago.
- $72.44 โ Just below VWAP of February 5.
- $72.98 โ Below the $73 round number and Value Area High of February 20.
- $73.28 โ Just below the POC of February 11.
- $73.90 โ Just below the Value Area High of February 3.
- $75.54 โ Final swing target, near Value Area High of January 23, an untested historical liquidity level.
๐ก Key Insight: The further price moves away from entry, the lower the probability of reaching distant targets. If price does get there, it typically takes longer, requiring patience.
๐ป Bearish Outlook
The bearish case currently appears slightly stronger than the bullish one, given that price has risen from the February 24 low of $69.78 but remains under key resistance. The bearish threshold is set at $71.21, which is:
- Just below the VWAP from two days ago
- In line with key historical levels, including the POC of February 3 and February 6
- Already trading below it, meaning the bearish scenario is active
๐ก Stop Placement:
- If shorting, the stop should be above the bullish threshold of $71.63, ensuring that a breakout invalidates the bearish case.
- It should not be lower than $71.56 and certainly not below the semi-round number $71.50.
๐ก Short Entry Consideration:
- Some traders may prefer to wait for a retracement up to $71.21 (VWAP from two days ago) or even $71.32 (Value Area Low of February 18) for a better short entry.
- Risk vs. Reward Trade-Off:
- Waiting for a retracement improves reward-to-risk but lowers the probability of getting filled.
- Shorting now is higher probability but offers a worse risk-reward ratio.
๐ฏ Bearish Profit Targets:
- $70.89 โ First key support level after entering bearish territory.
- $70.54 โ Just above yesterdayโs VWAP.
- $70.37 โ Just above yesterdayโs Value Area Low (VAL).
- $70.06 โ Below an important Value Area High from December 30, a major historical level.
- $69.52 โ Just above the Value Area Low of December 30, an even stronger support zone where shorts will likely cover positions.
๐ Additional Bearish Swing Targets:
- $67.77 โ A key level for patient swing traders.
- $67.50 โ Value Area Low of December 23, an important structural support.
- $66.76 โ Another potential downside target.
- $66.18 โ Value Area Low from December 11, a major long-term support where buyers may step in.
๐ Summary & tradeCompass Guidance
Today’s tradeCompass provides a structured approach for both bullish and bearish setups:
- Bullish trades are valid only above $71.63, with multiple profit targets up to $75.54.
- Bearish trades are currently active below $71.21, with short-term and long-term profit targets down to $66.18.
- TradeCompass helps traders navigate key liquidity areas where institutions, algos, and professionals are likely to react.
- Use these levels for partial profit-taking, stop-loss placements, and strategic decision-making.
As always, trade at your own risk, and visit ForexLive.com for additional market views. See you in the next tradeCompass update!