The earlier live market update on crude oil was quite successful in its predictions. The forex signal was closed at take profit level of $52.20. I intended to open another position below $52.10, but later decided not to open it. The oil prices placed a low of $52.08 but just for a few seconds, and never closed below $52.10.
At this moment, we really have a good trade setup in the crude oil. In the 1 – hour time frame, the crude oil has formed an asymmetric triangle pattern. It has defined an upper and lower range for the crude oil, where $52.60 is working as a resistance and $52.15 (old level) is working as a support.
Crude Oil – Hourly Chart
Additionally, the moving averages were bearish, but right now the price has soared to test the 50 periods EMA $52.60, which is making this trading level stronger. The RSI is also demonstrating a bullish bias. I really wanted to add a buy position, but remained reluctant due to the upcoming inventory figures which are due to be released at 15:30 GMT.
Expectation & Sentiments
Economists are expecting a drop in the inventory figures by -1.0M barrels from last week. This is bullish news for the crude oil, but one thing is confusing. Why is the crude oil exhibiting a slight bullish momentum?
I think investors are pricing in the news and the market is likely to reverse upon release. That's called buying the rumor and selling the fact. It's better to wait for the new release and later add a sell position.
Forex Trading Signal: Therefore, I may add a buy position above $52.60 with a take profit of $52.80. It's better to stay on the safer side and wait for the code oil inventory updates, which are due in a few hours.