Trading position (short-term; our opinion): Short positions (with a stop-loss order at $56.45 and an initial downside target at $45.81) are justified from the risk/reward perspective.

Although crude oil moved higher after the market’s open and climbed above $54, the key resistance area stopped oil bulls once again, triggering a pullback. As a result, light crude lost 0.63% and invalidated the earlier breakout above last week’s highs. Will we see lower values of the black gold in the coming days?

Today’s alert is going to be very brief, because crude oil didn’t do anything that would change the outlook on Thursday and the same applies to today’s session so far. The only thing that crude oil did yesterday is that it moved higher after the market’s open, but then reversed, cancelling all gains and finally closed 0.63% lower. Such daily reversal is a bearish sign, but the outlook was bearish anyway, so nothing really changed.

Consequently, the comments that we made on Thursday remain up-to-date also today and if you haven’t had the chance to read our yesterday’s alert, we encourage you to do so today. We will provide you with a bigger update once we see more interesting developments on the crude oil market - most likely on Monday.

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, Gold & Silver Fund Manager

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