Saudi Arabia’s pledge to curb on exports by almost a million barrels along with Nigeria’s voluntarily imposed ceiling on oil production at 1.8 million barrels per day earlier this week has reversed the course of North Sea benchmark WTI, which rose sharply in the past two days. The price of Brent has risen by almost 5.8 percent in the last two days, signaling a decline in the selling pressure.
We would like to recommend profit bookings on the short positions recommended by FxWirePro around $51.6 per barrel back in May with a target below $40 per barrel. While the bearish pressure that began back in 2014 riding on supply glut has not diminished completely, there lie opportunities on the bullish side at least in the short-term.
With a change in short-term outlook, we would like to recommend entering long positions at the current price of $50.7 per barrel and at dips around $49 and $48.5 per barrel, with a stop loss around $45 per barrel and with an initial target around $59 per barrel.
We would also like to recommend close monitoring of the positions as the long-term bearish pressure is still intact.
