WTI Crude Oil Mid Session Brief:Compression

October WTI crude oil futures are trading in a tight 52 tick range. Thus far consolidation has ruled the day and entire week for that matte

Written by: Dime Levov • Friday, August 25, 2017 • 1 min read

• Last updated: Friday, August 25, 2017

October WTI crude oil futures are trading in a tight 52 tick range. Thus far consolidation has ruled the day and entire week for that matter. Currently, the market is under heavy compression rotating between $47.50-90. Let's see if there is a trade setup for later in the session.

Technicals

Trading rotational crude oil markets can be tough. Breakouts can come out of nowhere, wrecking the soundest of trades. Below is the outlook for October WTI on the daily timeframe:

October WTI Crude Oil Futures- Compression

It has been a bit of a surprise that this week’s crude market has traded sideways. After the volatilities seen during last Friday’s rollover, I was optimistic that there was an upcoming trend to get in on. No such luck.

A few support and resistance levels:

R1 $48.00 Bollinger Band MP
R2 $48.05 20 Day EMA
R3 $48.93 62% Retracement of current daily wave
S1 $47.06 Thursday’s session low
S2 $46.62 Last Week’s swing low

The daily chart gives us considerable topside resistance for this market with little support. For now, this looks to be a stagnant market.

Possible Trades: I don’t see a whole lot in this market that knocks my socks off. Scalp sells from the topside resistance levels are possibilities as is a fast sell under Thursday’s low.

A high probability trade is a sell from the resistance area of $47.99- $48.05. Convergence of indicators is always a bonus and this is a cheap way to play a market stuck in rotation. A 1:1 reward risk ratio with a moderate profit target is the best way to proceed in these conditions.

As always, be smart and trade for tomorrow!