Morning Report for Crude Oil Futures for September Settlement

After the minor correction yesterday toward 96.50 level to form the right shoulder of the suggested inverted H&S formation-shown on left image- as we expected the commodity rallied to breach the neckline of the pattern and reach our target at 98.50 , the move was stopped near 98.60 and very close to point D which is the potential reversal zone of the pattern to reverse direction sharply and currently trade around the major support at 94.00 shown on right image and below the 200 days SMA which is a negative sign, therefore we will continue to expect downside movement for today. Trading range for the day is among the major support at 91.50 and the major resistance at 99.00.The short term trend is to the downside with steady daily closing below 105.00, targeting 87.00.

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RecommendationBased on the charts and explanations above we recommend selling oil with four-hour closing below 94.00 targeting 92.00 and 90.00. Stop loss with four-hour closing above 94.60