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 Friday, crude oil lost 1.21% as doubts about the impact of the OPEC and non-OPEC agreed output cuts weighed on the price. As a result, light crude erased most of Thursday’s increase and closed the day below $53. What’s next?
Today’s alert is going to be very brief, because crude oil didn’t do anything new, which could change the outlook on Friday and the same applies to today’s session so far. Although light crude moved higher after the market’s open, there was no comeback to the December 2015 or January 2016 highs, which means that the commodity is still trading under the previously-broken lower border of the blue rising trend channel and there are no bullish implications of this move.
Consequently, the comments that we made on Friday 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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