Oil traded as we forecasted in our earlier forecast Trade Setup In The WTI Crude Oil – Sideways Channel Still Alive. But the drop in Crude Oil was massive and uncertain. Today, I think we will have another good opportunity it Crude Oil. Let's take a look.

Reasons Behind a Sell-off

Firstly as per Iraq, their exports lifted slightly in the month of September, particularly from their southern oil fields. Increase in exports indicates the increased supply of Crude Oil in the market. Here applies the Law of Supply: The increased supply and stable demand result in fall in prices of things. That's exactly what happened to Crude Oil a day before.

Secondly, do you remember the crude oil trading range of $51.40 -$52.30? It's violated over fundamentals release, and investors jumped to trade the breakout. As of now, I see an immediate support at $50.10 and a solid resistance is found at $50.75.

Crude Oil – 4 – Hour Chart – Range Breakout

The Oil is oversold, and we need to wait a bit for Oil to pull back until $50.75 before placing any trade. Well, It really doesn't mean that we need to take a buy position now.

WTI Crude Oil – Trading Idea 

Today, I will be focusing on $50.75 to enter a sell position below this with a stop loss above $51.10 and a take profit of $50.25. Good luck!