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.

On Thursday, crude oil wavered between small gains and losses after a mixed the EIA weekly report on crude oil and fuel inventories. What’s next for the black gold?

Today’s alert is going to be short, because although crude oil moved a bit higher yesterday, it still remains between Wednesday’s high and low. Additionally, an invalidation of the breakout above the long-term red support/resistance line based on the October 2015 and June 2016 highs and its negative impact on the price are still in effect, supporting oil bears and another attempt to move lower. The pro bearish scenario is also reinforced by the sell signals generated by the weekly and daily indicators, which means that lower prices of light crude are just around the corner.

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 previous alert, we encourage you to do that today.

Thank you.

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

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