Hello Traders,

As of this morning we initiated a short term buy on Crude oil since we hit our key trading levels on this commodity. We are also long CADJPY and short USDCAD. Crude oil inventories came out earlier and this news helped our trade as it was met with a nice stop run, and a chance for us to build a position as low as 39.20. My Forex Trading Signal was sent out earlier when we hit out key level on this commodity.

One thing we must keep in mind is how OIL behaves at certain key areas and in this case we were spot on our 50% fib level from the highs met last month. We also hit that 40 level on oil which is a psychological level. Some may say well we broke the 40 level though? This is not a problem as this is healthy since most commodity trades will run stops before a change in direction.

I do not feel it is constructive to wait for the exact key level to get hit and sometimes get in a little earlier than a fib level since many brokers structure their trading zones differently and this can have a profound effect on where fibs close because candles will be different. The bottom line is draw trend lines with a crayon not with a pencil and you will be amazed at the trading success you will have. Below I am have a few charts and videos on my thoughts on this trade, I hope this helps you.

You will see several key levels out lined in my chart below. We are approaching the lower trendline channel, I feel this will be broken based on the decrease in momentum we have seen to the upside in the last few days.

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