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

Although light crude moved higher after the market’s open, the commodity reversed and declined after the EIA report showed that crude oil inventories rose by 2.3 million barrels last week. Although yesterday’s increase was smaller than analysts’ forecast, it was a seventh straight week of record highs, which affected negatively investors’ sentiment and pushed light crude to important medium-term support. Will it withstand the selling pressure in the coming days?

Today’s alert is going to be quite short, because crude oil didn’t do anything new. The commodity moved to the medium-term red declining support line, but there was no breakdown below it (on the daily basis). In our opinion, this is a repeat of what we already saw on Tuesday and there are no strong bearish implications of this move.

Consequently, the comments that we made yesterday 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.

Thank you.

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

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