Trading position (short-term; our opinion): Long positions (stop loss at $37.23; initial upside target at $46.90) are justified from the risk/reward perspective.
On Tuesday, crude oil pared some of previous gains ahead of the weekly crude inventory reports. As a result, light crude lost 0.58%, but despite this drop the commodity closed the day above the previously- broken lines. Will we see further improvement in the coming days?
Today’s alert is going to be qute short, because crude oil didn’t do anything that would change the outlook on Tuesday and the same applies to today’s session so far. The only thing that crude oil did yesterday was small decline, which took the commodity to the previously-broken lower border of the back declining trend channel. Despite this move, light crude closed the day inside the trend channel and above the long-term black declining line, which doesn’t change anything in the short term. Additionally, buy signals generated by the indicators are still in play, supporting oil bulls and higher prices of the commodity. Therefore, the comments that we made yesterday remain up-to-date also today and if you haven’t had the chance to read our previous Oil Trading Alert, we encourage you to do so today. We will provide you with a bigger update once we we see more interesting developments on the crude oil market - most likely tomorrow.
Thank you.
Nadia Simmons
Forex & Oil Trading Strategist
Przemyslaw Radomski, CFA
Founder, Editor-in-chief
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