WTI Crude Oil: oil prices are going down

Current trend

Oil prices showed a decline on Tuesday, responding to a sharp deterioration in the prospects for a trade agreement between the US and China after Washington blacklisted some Chinese companies. Donald Trump also changed the tone of his rhetoric regarding negotiations, emphasizing that achieving quick results is unlikely. In turn, some support for the quotes was provided by the ongoing unrest in Iraq and Ecuador, which are likely to adversely affect oil production. API Weekly Crude Oil Stock Report reflected an unexpected growth of the stock by 4.13 million barrels in the week as of October 4, after a decrease of 5.29 million barrels over the past period.

Support and resistance

Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is insignificantly narrowing from below, reacting to the emergence of ambiguous dynamics in the ultra-short term. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic is growing and almost does not respond to the "bearish" nature of trading, observed since the beginning of the week.

To open new positions, one should wait for trade signals to become clear.

Resistance levels: 52.83, 54.00, 55.89, 56.88.

Support levels: 51.84, 51.05, 50.00.

Trading tips

To open long positions, one can rely on the breakout of 54.00. Take profit — 58.42. Stop loss — 51.84. Implementation time: 2-3 days.

The breakdown of 51.84 may serve as a signal to new sales with the target at 50.00. Stop loss — 53.00. Implementation time: 1-2 days.

Scenario

  • Timeframe

    Intraday

  • Recommendation

    BUY STOP

  • Entry Point

    54.00

  • Take Profit

    58.42

  • Stop Loss

    51.84

  • Key Levels

    50.00, 51.05, 51.84, 52.83, 54.00, 55.89, 56.88

Alternative scenario

  • Timeframe

    Intraday

  • Recommendation

    SELL STOP

  • Entry Point

    51.80

  • Take Profit

    50.00

  • Stop Loss

    53.00

  • Key Levels

    50.00, 51.05, 51.84, 52.83, 54.00, 55.89, 56.88