Short term
Trade view / 23 August 2016 at 7:50 GMT

Lower prices seen as oil posts Evening Star

Director / PIA-First Limited
United Kingdom
Instrument: OILUSOCT16
Price target:
Market price:

The drive higher in prices over the past three weeks has been impressive and the speed has been exceptional.

Action stalled just shy of $49 and a correction is currently targeting a pullback to the $45 area.
Price action over the last three days has formed an Evening Star formation, which is negative for sentiment.

This is a possible 4th wave correction before the next impulse drive higher. We look to set shorts at good risk/reward levels to capitalise on this move whilst maintaining a mildly positive outlook on the more medium term.

Management and risk description

After shorts are set we would look to move stop to entry once the first target is achieved.


Entry: Sell OILUSOCT16 at current levels & $47.75/barrel.

Stop: A break above $48.75/b.

Target: $45.00/bl & $44.00/b.

Time horizon: 1–3 days.

4th wave correction:
 Source: SaxoTraderGO

Evening Star formation:
 Source: SaxoTraderGO

Weekly chart:
Source: SaxoTraderGO

— Edited by Clare MacCarthy

Non-independent investment research disclaimer applies. Read more
joe200002 joe200002
Hi Steve , any update on this trade ? Thanks
Steve O'Hare - First 4 Trading Steve O'Hare - First 4 Trading
Hi Joe, cautious shorts could bring stop in to $47.75-48.00. Currently we have a bespoke line of resistance just above today's high. $46.40-50 is key support and a break here should assist in the down move accelerating. Good Luck!
AlexF AlexF
Thanks short from 46.5 got out at 44 USD based on the above.


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