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Oil Down the Hill (Trade of the Day)

Will not bore you with a lot of macro-fundamentals; currently, oil prices are driven by recession fear, a global slowdown in demand and US oil production and in a concerted form all three variables are pulling price downwards. Hence we see any bullish move in oil prices as an opportunity to “sell the rip” – a scenario currently playing.

Technically, price is bouncing off the resistance area of a downward channel line at the 57.50 price area (highlighted in grey) (see WT4 H1 chart) – we would look to short price using this area as risk threshold.

Fig 1: Hourly (H4) WTI Chart

WTI/USOil/US Light Crude Fut. (Oct)

Sell @ current market price (instant execution)  Stop: 5545 Limit: 5200

Alternatively, there is a Suadi-led OPEC that would try their best possible not to see price lower, thus opening up to the possibility of the release of statement rhetorics that may pump prices – which by default will nullify the above outlook. Due to uncertainties such as this, it is advisable that traders always use a stop loss.

RISK WARNING Investing in Eagle Global Markets derivative products carries significant risks and is not suitable for all investors. You could lose more than your deposits. You do not own, or have any interest in, the underlying assets. We recommend that you seek independent advice and ensure you fully understand the risks involved before trading. Spreads may widen depending on liquidity and market volatility. The information on this website is prepared without considering your objectives, financial situation or needs. Consequently, you should consider the information in light of your objectives, financial situation and needs.

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