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

We 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!