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Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

Crude Oil, Fresh Lows and Support Zone

Commodities / Crude Oil Jun 23, 2017 - 12:05 PM GMT

By: Nadia_Simmons

Commodities

On Wednesday, the black gold moved lower once again after government data showed an increase in crude oil production, which offset a decline in crude oil and gasoline inventories. Thanks to these circumstances, light crude hit a fresh 2017 low. What’s next for the commodity?

Let’s take a closer look at the charts and find out (charts courtesy of http://stockcharts.com).


In our yesterday’s Oil Trading Alert, we wrote the following:

(…)  crude oil extended losses and hit a fresh 2017 low of $42.94. Thanks to this drop, light crude also broke below the 38.2% Fibonacci retracement, which opened the way to the mid-November low of $42.20.

From today’s point of view, we see that the commodity extended losses and slipped slightly below our next downside target yesterday.

How did this drop affect the very short-term picture? Let’s check.

Quoting our previous alert:

(…) it seems to us that the space for declines is limited. Why? Because even if light crude breaks below the green support zone and the red dashed support line, not far from current levels are also the mid November low and the lower border of the blue declining trend channel, which together could stop oil bears and trigger a reversal in the coming day(s).

Looking at the daily chart, we see that the situation developed in line with the above scenario and crude oil slipped to the above-mentioned downside target. Despite this deterioration, the commodity moved a bit higher earlier today, which suggests that we may see further improvement in the coming days. Nevertheless, such price action will be more likely if we see buy signals generated by the indicators and a comeback above the red dashed line, which serves as the nearest resistance. In this case, we’ll consider opening long positions. Until this time, waiting on the sidelines (and sitting on the profits from the previous short positions) appears to be a good idea.

Summing up, crude oil extended losses and reached the solid support zone, which triggered a rebound earlier today. Additionally, the current position of the daily indicators suggests that higher values of crude oil are just around the corner.

If you enjoyed the above analysis and would like to receive free follow-ups, we encourage you to sign up for our daily newsletter – it’s free and if you don’t like it, you can unsubscribe with just 2 clicks. If you sign up today, you’ll also get 7 days of free access to our premium daily Oil Trading Alerts as well as Gold & Silver Trading Alerts. Sign up now.

Nadia Simmons
Forex & Oil Trading Strategist

Sunshine Profits: Gold & Silver, Forex, Bitcoin, Crude Oil & Stocks
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Disclaimer

All essays, research and information found above represent analyses and opinions of Nadia Simmons and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Nadia Simmons and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Nadia Simmons is not a Registered Securities Advisor. By reading Nadia Simmons’ reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Nadia Simmons, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.


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