Trading position (short-term; our opinion): Short positions (with a stop-loss order at $48.56 and initial downside target at $35.24) are justified from the risk/reward perspective.
On Tuesday, the U.S. dollar bounced off a multi-month low, making crude oil more expensive for buyers holding other currencies. In this environment, light crude lost 2.25% and closed the day under $44. What’s next?
Today’s alert is going to be quite short, because crude oil declined as we had expected and closed another day under the red resistance zone and the short-term resistance line. Additionally, sell signals generated by the indicators are still in play, supporting oil bears and further deterioration. This means that 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.
As always, we’ll keep you - our subscribers - informed should anything change.
Thank you.
Nadia Simmons
Forex & Oil Trading Strategist
Przemyslaw Radomski, CFA
Founder, Editor-in-chief
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