Oil price couldn’t continue its two days rally due to oversupply, also because investors see that China’s import is declining.
After the US Non-Farm Payrolls report, stronger dollar likely will weigh down oil price. US economy added 255,000 new jobs in July higher than expected. Stronger dollar will make oil price more expensive for buyers who use currency other than USD.
Oil price currently is moving between 20 MA and 50 MA on hourly chart; both MA are rising. Note that hourly stochastic is in neutral stance. Oil price is testing the intraday Fibonacci support area at 41.44-41.05. Intraday bias remains bullish in general.
As today’s trading strategy, you might want to go long on oil with 41.68 as target and 42.07 in extension, but beware of possible correction to within the Fibonacci support area once again. Be very careful if the price managed to break below the support at 41.05 because it will turn the intraday bias bearish and possibly will push oil price down to 40.81-40.42.
Buy; S/L @ 40.90, T/P @ 41.68 or 42.07