Reversal! WTI Crude Oil Futures Nearing Key Resistance Area-Get Ready To Short $47.46
The bulls are in firm control of today’s October WTI crude oil futures market. After a test under Wednesday’s low on the electronic open, we have seen a $1.20 rally. This rally may produce a great shorting opportunity.
I mentioned yesterday that the conventional wisdom towards crude oil values after Harvey may be a bit questionable. As precise reports begin to roll in on storage and refinery damage, this market will see even heavier participation. That can be a great thing for us traders.
Technicals
The intraday time frames have October WTI crude oil trend day up. However, the daily chart gives us an affordable area to take a short.
Daily October WTI Crude Oil Futures-Nearing Topside Resistance
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Daily October WTI Crude Oil Futures-Nearing Topside ResistanceWe have a defined resistance zone from $47.46 to $47.60. This area should attract sellers. Here is why:
38% of August’s range at $47.46
Round number $47.50
Bollinger MP at $47.59
20 Day EMA currently at $47.57
Bottom line: I like it when we have many technical indicators sharing a common area. This market has already posted a daily range of 178 ticks and is a bit overextended. Our defined resistance zone should bring sellers to the table.
The trade is fairly straightforward: Sell October WTI crude oil futures at $47.46 with a stop of $47.76. Employ a 1:1 reward risk. This is an affordable opportunity to rack 25+ ticks with an achievable R:R.
As always, stay within your means and trade smart!
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