Please note that due to market volatility, some of the key levels may have already been reached and scenarios played out.

Trading positions 

• Natural Gas [NGK22]
  No new position justified on a risk/reward point of view.
• RBOB Gasoline [RBK22]
  No new position justified on a risk/reward point of view.
• Brent Crude Oil [BRNK22]
  No new position justified on a risk/reward point of view.
• WTI Crude Oil [CLK22] – Entry triggered!
  Long around the $99.55-101.29 support area (yellow band) with a stop just below $92.20 and targets at $113.90 & $120.66.

Monday:

WTI Crude Oil (CLK22) Futures (May contract, daily chart)

Wednesday:

WTI Crude Oil (CLK22) Futures (May contract, daily chart)

Regarding risk management, it is always best to define your strategy according to your own risk profile. For some guidance on trade management, read one of my articles on that topic.

The trading plan explained

The dip took place as the oil market bottomed at 98.44 (facing rejection from the bulls towards the $100 mark), thus triggering the suggested entry around $99.55-101.29, highlighted by the yellow band. The first recommended target, projected at $113.90, has been half-filled up so far. My recommended stop – initially placed just below the $92.20 level (March’s swing low) – could now be lifted:

• to a new swing low (98.44)
• to breakeven, or slightly above it.

Personally, given the current volatility of crude, I would drag my stop up to $102.83 (Monday’s low) and then lift it again to $104.55 (today’s low) once prices break the $107.84 level (yesterday’s high). Since black gold is currently trading at $107.20 – we are getting very close to it since today’s prices made a high at $107.70 – to do so, I suggest setting a price alert up there.

Update: as I was writing these few lines, my alert just got triggered, so here it goes – stop lifted to $104.55.

WTI Crude Oil (CLK22) Futures (May contract, 4H chart)

Here, I voluntarily removed the intermediate stop levels for better clarity, although you can look at them in the following chart:

WTI Crude Oil (CLK22) Futures (May contract, 4H chart)

As you can see, the level provided was optimal given its support function to act as a floor for rebounding prices.

On a side note, prices may encounter some resistance now as they’ve reached the current month’s Volume Price of Control (VPoC). Consequently, exchanged volumes are going to acelerate around that level.

That’s all folks for today. Happy trading!

As always, we’ll keep you, our subscribers well informed.

Thank you.

Sebastien Bischeri
Oil & Gas Trading Strategist