WTI Crude Oil Traders Can’t Make Up Their Mind!
The energy commodity is still trading in its visible zone of interest on the 4-hour time frame, with several inflection points extending across the area.
Will the trend continue in the long term?
Crude Oil WTI (USOIL) Forex 4 Hours Chart by TradingView
The escalation of geopolitical tensions last week pushed crude oil prices to the previous support area around $72 per barrel, which remained as resistance this time around.
After all, the spotlight seems to have shifted away from the conflict in the Middle East and back towards concerns about global demand, with major economies reporting negative preliminary PMI readings a few days ago.
This has led crude oil to fall to the bottom of its short-term ascending channel at around $60.75 per barrel, which appears to still be a bottoming level for now.
Will we see a decline and more downward momentum?
Remember that directional biases and volatility in market prices are usually driven by fundamentals. If you haven’t done your homework on crude oil and the US dollar yet, it’s time to take a look at the economic calendar and stay up to date with the daily fundamental news!
The 100 SMA is below the 200 SMA, suggesting that the path of least resistance is to the downside. Watch for a move below channel support, as this could drag the energy commodity price to the next downside targets at S2 ($67.45/bbl) and S3 ($66.36/bbl) or to the swing low in line with S4 ($65.27/bbl).
On the other hand, a bounce from near-term support could be followed by a return to the channel top near R1 ($72.28/bbl). Continued bullish pressure could trigger another attempt to break out of the area of interest, which could lift crude to the next upside barriers at R2 ($73.37/bbl) and then R3 ($75.24/bbl).
Don’t forget to practice proper risk management and stay aware of top-tier market triggers when trading this product. Good luck!