Oil saw a selloff Wednesday towards the daily consolidation floor from February to March only to turnaround on poorer US inventory numbers. Following this was a tight range Thursday on a combination of holidays and a lack of market moving data. The next key event for us in oil is not until next weeks US CPI and and the inventories data, as such absent new geopolitical issues we would prefer looking at charts for guidance.
Resistance
- 85.68 – Bearish Channel Resistance
- 85.15 – Previous Swing Low
- 84.27 – Intraday Range Play High
Support
- 83.71 – Previous Intraday Highs
- 83.21 – Thursday’s Low
- 82.61 – Daily Consolidation FLoor
Although partly due to the absence of some European traders, the tight spinning top from yesterday suggest a lack of momentum for bulls. Add to this the immediacy of resistances and we are more inclined to think we are still in a consolidation. We prefer looking for shorts on a break of the 83.71 price point, or should we see failed peaks above 84.27 with long wicks in the hourly charts. We will consider buying on a strong push above 84.27 preferably with some news behind it.
