Trade view /
02 September 2016 at 11:34 GMT
Brent crude oil is trading higher today following a near 10% selloff earlier in the week. Speculative long positions have now been scaled back and with the return of verbal intervention, this time from Russia, we could see the market recover at least some of what was lost.
The selloff was halted once the market had retraced 61.8% of the August rally. With the renewed and potentially more potent discussion about a production freeze emerging we now look for a response to the upside with the target being the 38.2% retracement of the latest selloff.
Buy LCOX6 or OILUKNOV16 at market (last at $46/b)
$45.20 (relatively tight with 1 ATR currently at $1.4/b)
1 to 2 weeks
Key risks: US jobs report leading to a stronger dollar, US rig count and inventory reports
Seasonality: From a seasonal perspective oil has fallen every September in the last five years
Source: Saxo Bank
— Edited by Clare MacCarthy
Non-independent investment research disclaimer applies. Read more