Early in the Asian trading session, the crude oil prices were trading lower at $48.70 with a bearish bias. The new wave of sellers entered the market after Libya boosted oversupply concerns as their production bounced to the highest levels since 2014.
Libya, being a member of petroleum exporting countries, was supposed to limit the production and supplies to support the falling oil prices, but it failed badly. You must be wondering why the gain in Libyan oil supplies caused threats in the oil market. This is mainly because Libya is the 9th country in the list of countries with the largest proven oil reserves.
Besides this the fundamentals, the technical side of the market also supported the bearish bias of the WTI crude oil. For example, looking at the 4 – hour chart, the prices are holding below 50 periods EMA which demonstrates investors' bearish sentiment. In addition to this, the momentum indicator RSI was also holding in the selling zone, but later it reversed.
WTI Crude Oil – 4 Hours Chart
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Considering the facts, I decided to enter a sell position below $48.70 with a stop loss of $48.90 and a take profit of $48.4 but unfortunately, the market reverse surprisingly hit the stop loss. However, before closing at the stop, the market gave us a chance to secure our position by dragging the stop loss at the breakeven level as the crude oil remains in a more than 10 pip profit.
Anyways, at this point, I'm looking for the prices to test $49.30 before entering another sell, possibly in the New York session.
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