H4 chart
Crude futures scored its first profit on Wednesday after two days of falling.
The weekly report from the Energy Information Administration, U.S. showed a smaller than expected fall in crude inventories and a rise in gasoline stocks. The EIA reported that crude inventories for the week ended September 06 fell by 200,000 barrels versus 2 million barrels expected.
In 4-hour chart we notice that after fears of a possible U.S. military intervention temporarily dissipated crude oil has been making lower highs and listed below a downtrend line, being at this time about to break both bottom lines of the trend channel and the green uptrend line, which will occur in the following hours or days and would be a confirmation of a trend change. So our choice for today's session is to enter the market with short positions with a stop loss set at 108.20.
H1 chart
The 1-hour chart shows a clear downward trend and now Crude Oil is in what could be its 3rd wave Fibonacci extension.
On the one hand, we have an important resistance line 2/8 (red line) which in turn converges with the top line of the downtrend channel.
On the other hand, to be below its trading range bounded by the green line 3/8 also confirms the downtrend.
However, the possibility of what seems wave Fibonacci number 2, which extends to the level of resistance delimited by the blue line close to the 4/8 is also likely Murray.
So going into this area with sales positions, our minimal risk should be around 150 pips for a possible gain of 300 pips. Thus, our capital management would be in the order of 2 to 1.
30-minute chart
The 30-minute chart allows us to see the retreating Crude Oil Line 5/8 (green line) which came to be the top line of its trading range. Furthermore, we also observed beneath the line 8/8 (solid line) considered last support area. But in addition to this we have a wider time frame line 6/8 (red line) considered a strong point of reverse which could lead to crude oil to make a rally of at least 300 pips to find their support in line 2/8 (red line)
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Email:antonio.inga@analytics.instaforex.com
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