We opened a trade signal to buy black crack at 45.40 in order to catch a quick 25 pips during the Asian session. In the end, we closed the position manually at $45.50 to pocket a profit of 10 pips. This proved to be a good idea as in the very next moment the price fell below $45.20.
Technically, the oil has stuck in the long-term trading range of $43.75 – $46.50. In between these levels, we have to grapple to find our bread. On the 4-hour chart, $45.55 is extending a solid resistance. $45.25 is a support for now.
On Thursday, the oil went bullish over the release of the latest Energy Information Administration (EIA) data. The data recorded an inventory draw of 7.56 million barrels. This was higher than the previous weeks' draw of 6.3 million barrels. So, the question is, can we benefit from the news? Yes, we can. In order to do so in the most effective way, let me recommend reviewing our FX Leaders news trading strategy article.
But know that the game is slightly different as investors are trading technicals while ignoring the fundamentals. Having said this, we may see a breakout below $45.20, the double bottom support level. In the case of breakage, the oil is likely to test $44.85.
Forex Trade Signal – Idea
At the moment, I'm looking placing a sell stop at $45.15 with a stop loss of $45.45 and take profit of $44.85. Good luck!
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