WTI Crude Oil Technical Analysis – Key resistance in sight | Forexlive

Crude Oil continues to
hover near the highs as the supply tightness remains at the centre of the
market’s focus at the moment. In fact, Saudi Arabia and Russia are sticking
with their production cuts and the resilience in the global economy is
supporting higher oil prices. The bearish case is that the bullish sentiment in
the market is getting stretched with many participants starting to call much
higher prices ahead, but such high prices are likely to weigh on demand even
more eventually leading to a drop.

WTI Crude Oil Technical
Analysis – Daily Timeframe

On the daily chart, we can see that after the
breakout of the key resistance around
the $83 level, Crude Oil just kept on rallying with almost no pullback towards
the next resistance around the $93 level. The price recently pulled back into
the red 21 moving average where
the buyers stepped in again targeting another push into the $93 resistance. The
sellers are likely to pile in around the resistance with a defined risk above
it to position for the top and much lower prices next.

WTI Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that Crude Oil is diverging with the
MACD right as
it trades into the key $93 resistance. This is generally a sign of weakening
momentum often followed by pullbacks or reversals. In this case, we got the
first pullback into the support around the $88 level where the buyers piled in
with a defined risk below it to target another rally into the $93 resistance.
This push might be the last one as the divergence will be much stronger at that
point and such high prices are starting to weigh on demand.

WTI Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the strong rally from the $88 support and the break above the trendline around
the $90.50 level. The buyers might want to wait for a pullback into the $90.50
level where we have the confluence with
the broken trendline and the 38.2% Fibonacci
retracement level and the red 21 moving average to
increase the longs into the $93 resistance. The sellers, on the other hand,
will want to see the price falling back below the trendline to pile in and
target the break below the $88 support.

Upcoming Events

This week is pretty bare on
the data front and the only report that might weigh on Crude Oil looks to be
the US Jobless Claims tomorrow. Strong readings are likely to keep Crude Oil
supported in the short term, while weak figures might weigh on sentiment and
demand outlook and drag Crude Oil prices down.

See also the video below