WTI Crude Oil Technical Analysis | Forexlive

Crude Oil has been
supported amid a confluence of positive supply and demand drivers, but the
recent US data made the picture murky. In fact, on the supply side, the
tensions in the Red Sea are still present and overall, there’s still a high
geopolitical risk in the Middle East. Moreover, recently OPEC+ extended the voluntary output cuts into Q2.

On the demand side, the
recent economic data has been showing a reacceleration in activity which was
supported by the rate cuts expectations and the end of the tightening cycle. Last
week though, the US ISM Manufacturing PMI, which is one of the most important
leading indicators, missed expectations by a big margin. It might be just a
blip or the recent pullback in rate cuts expectations turned the momentum
around. Nonetheless, this might be enough for a bigger correction in Crude
prices.

WTI Crude Oil Technical
Analysis – Daily Timeframe

On the daily chart, we can see that Crude Oil failed
to break out of the key $80 resistance zone
following the miss in the ISM Manufacturing PMI. The price pulled back into the
red 21 moving average where we
found some buyers stepping back in to try again to break out. We can expect the
sellers to lean on the resistance again with a defined risk above it to target
a drop back into the major trendline around
the $76 level.

WTI Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the buyers
leant on the black trendline where they had the confluence with the
61.8% Fibonacci retracement level
and the daily 21 moving average. If the price were to break lower, the bullish
setup would be invalidated, and the sellers will likely increase the bearish
bets into the major trendline around the $76 support.

WTI Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with two key levels now to watch carefully. In
fact, on the upside we have the resistance around the $80 level where we can
also find the confluence of the downward trendline and the 61.8% Fibonacci
retracement level. On the downside, we have the support around the $78 level and
the confluence of the upward trendline and the 61.8% Fibonacci retracement
level. The buyers will look for a breakout to the upside to increase the
bullish bets into new highs, while the sellers will defend the resistance and
increase the bearish bets on a break below the $78 support.

Upcoming Events

Today we have the US ADP, the US Job Openings and
the Fed Chair Powell speaking. Tomorrow, we get the latest US Jobless Claims
figures, while on Friday we conclude the week with the US NFP report. Weak data
is likely to weigh on Crude Oil, while strong figures should give it a boost.

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