Crude oil is breaking down for last two days and seems like it can reach our final short target of 42 soon. What we really need is a clean break of 44. So caution is advised for new comers because if crude is not able to settle below 44 then it can spike higher to shake weak shorts.
Besides, as soon as Crude slides near 41 / 42, we will be switching the side to get long targeting the rally back to 45 again!
If you are short from better levels, preferably above 46 then stay short, otherwise don’t get sucked into Friday’s silly price action to initiate the short here. Because as per the characteristics of recent market, you can’t rule out face ripping rally if crude can’t break 44 easily.
Also, as per strong recent correlation between crude oil and USD/CAD, we are long USD/CAD as well.
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