Trading position (short-term; our opinion): No positions are justified from the risk/reward perspective.

On Thursday, crude oil extended gains and climbed to $42 as the Wednesday’s EIA weekly report indicated that the supply glut in gasoline inventories could shrink in the coming weeks. Because of these circumstances, light crude gained 2.69% and climbed above the 200-day moving average. What does it mean for the commodity?

Today's alert will be quite short, because crude oil extended gains on Thursday. With yesterday's move the commodity climbed not only above the Wednesday's high, but also above the 200-day moving average. Additionally, light crude closed the day above this resistance, invalidating earlier breakdown. On top of that, but signals generated by all indicators remain in place, supporting further improvement. Taking all the above into account, we believe that what we wrote yesterday is up-to-date and our upside target would be in play in the coming day(s). We will provide you with a bigger update once we see the weekly closing price.

Thank you.

Nadia Simmons
Forex & Oil Trading Strategist
Przemyslaw Radomski, CFA
Founder, Editor-in-chief, Gold & Silver Fund Manager

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