Let's take a closer look at the chart below (chart courtesy of www.stooq.com ) and assess the likely crude oil price path ahead.
We wrote these words yesterday, and they ring true also today:
() The short-term situation hasnt changed much. Crude oil futures keep trading inside the blue consolidation and around the red support/resistance line and the 50% Fibonacci retracement.
Theyre also still trading inside the rising purple trend channel below the upper border of the orange gap. Therefore as long as there is no breakout above these resistances another attempt to move lower is likely.
Yesterdays candle shows that bulls have been rejected at the upper border of the blue consolidation, and the bears keep the initiative today. Theyre currently working to close the bullish green gap, as black gold is trading below $56.25 as we speak. The daily indicators are supporting the downside move, and the bears next target would be to break down from the blue consolidation.
Summing up, after yesterdays upswing that partially fizzled out, crude oil is moving lower today. While the short-term picture remains unchanged, prices have backed down from the orange resistance and back below the horizontal red line and the 50% Fibonacci retracement. The bears objectives are closing the green gap and breaking below the lower border of the blue consolidation reinforced by the 38.2% Fibonacci retracement. The short position remains justified.
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All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.