December Crude Settles at 86.04, Lowest Since Sept 4, as Selling Bias Deepens

December WTI crude settled at 86.04 on Tuesday, down 0.81 or 0.93 percent, its lowest settle since September 4 and a second straight lower close. The session traded between 86.93 and 83.88 — a lower high and a lower low against Monday — and the 3.05-point range was the narrowest since October 30.

The high printed in the 8:00 PM ET bar Monday evening; the low, 83.88, in the 4:30 AM ET bar Tuesday, which also marked a one-month low. The 8:30 AM ET bar fell 0.73 as the October consumer price index, released at that hour on November 10 per the verified forward calendar, printed 0.4 percent against a 0.3 percent forecast — the decline and the release coincided. The contract then recovered through the morning, with the 11:00 AM ET bar gaining 1.06 to 86.73, and the settle finished at 70.8 percent of the range.

What moved the complex?

Brent's January contract fell 1.17 percent to 91.49. Gasoline dropped 1.59 percent and heating oil 1.99 percent. The dollar index rose 0.57 percent to 102.23, and the ten-year yield index closed at 4.98 percent.

The provider's market commentary attributed the second day of losses to optimism over a diplomatic end to the war with Iran — attributed commentary, and worth treating as such rather than as established fact. Two days of selling have now stripped 4.79 points off the December contract.

After the settle, a news-feed item carried an industry estimate of a 9.8-million-barrel crude draw against a 1-million-barrel forecast, alongside a 5.1-million-barrel build at Cushing. That figure is unconfirmed against the verified calendar.

Where does the technical picture stand?

The composite multi-indicator read is 32 percent sell with weak strength, up from 24 percent sell a session earlier, with negative direction leading on both directional systems. The settle sits below the 5-day, 9-day, 20-day and 50-day settlement averages — the 50-day for a fifth session — and above the 100-day and 200-day.

In this review's interpretation, the bias is neutral to lower beneath Pivot R1 at 87.35, with a rebound into that level the more likely first test and a stall beneath the 88.12-to-88.19 grouping the base case.

Resistance levels stack as follows:

• 89.08: two standard deviation resistance
• 88.67: Pivot R2
• 88.47: 5-day settlement average
• 88.19: one standard deviation resistance
• 88.12: stall of the 14-day %K line
• 87.49: 38.2 percent retracement from the 13-week low
• 87.35: Pivot R1
• 86.93: Tuesday's session high

Support runs:

• 86.04: Tuesday's settle
• 85.62: Pivot Point
• 84.75: published target price
• 84.30: Pivot S1
• 83.88: Tuesday's low and one-month low
• 83.15: low of September 4
• 82.57: Pivot S2
• 81.25: Pivot S3

What is the trade setup?

The primary setup is short the December contract from the 87.30-to-87.60 band, around Pivot R1 at 87.35 and the 87.49 retracement. The stop sits at 88.20, above the 88.12 stall of the 14-day %K line and the one standard deviation resistance at 88.19.

Targets fall at 86.70 first (beneath the 86.83 cash-hours high), 85.95 second (below the 86.04 settle, above the Pivot Point), and 85.20 third (above the 84.75 published target). Risk-to-reward runs roughly 1:1, 1:2 and 1:3 to the three objectives from the entry midpoint. The 14-day average true range is 4.46 points against a 0.75-point stop distance — wide room for noise around a tight stop.

A settle above Pivot R2 at 88.67 negates the thesis. Two consecutive 30-minute closes above 87.60 remove the edge before the stop is hit.

The review flags the tail risks plainly: a report that talks with Iran have stalled, a further attack on Gulf energy infrastructure, or a government inventory figure that confirms the industry draw could carry price through the stop in one move. The framing is an analyst judgment that rebounds into Pivot R1 are to be sold, not a certainty.

What does Wednesday hold?

Wednesday is the Veterans Day holiday with CME Globex running normal hours, and the weekly government petroleum report shifts to 12:00 PM ET Thursday. Per the review's interpretation, Wednesday is a test of whether a rebound stalls beneath the 87.35-to-88.19 band, or whether the decline extends through Tuesday's 83.88 low toward Pivot S2 at 82.57.

Watch the 87.35 line — the first test tells you which way the week breaks.