It is too early to dive into bullish positions head first but a base may be forming at least enough for a bounce to the down sloping trend line. In recent sessions I’ve advised bearish trades to exit. For the last 7 sessions futures have been establishing a base and on a settlement above $87/barrel in December contract it would be signal in my eyes an interim bottom is in. The orange line identified as the 8 day MA has also served as resistance for the last 2 weeks so as we retake that hurdle that would also help the bullish case.
A return to the 50% Fibonacci level and the trend line puts his contract back near $89.50. Not necessarily the start of a bull market but enough action for a quick long trade in either futures or option for nimble traders. Aggressive traders should gain light bullish exposure trying to capitalize on an appreciation in the weeks to come.
By. Matthew Bradard
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