WTI Crude Oil Technical Analysis | Forexlive

Crude Oil continues to sell
off as the bearish reasons keep on accumulating. In fact, the bulls switched
from fearing undersupply to now looking at oversupply as demand continues to
weaken and will likely slow even more in 2024 as the major economies could
enter in recessions due to tight monetary policies. The latest OPEC+ cuts were
taken as a big disappointment and with the US production at record levels,
there are very little reasons to be bullish on Crude Oil.

WTI Crude Oil Technical
Analysis – Daily Timeframe

On the daily chart, we can see that Crude Oil
continued to sell off since the last notable pullback into the 38.2% Fibonacci retracement level
and the trendline around
the $79 level. The price recently broke below the swing low, retested it and
continued lower as the sellers keep targeting the cycle lows around the $64
level. The bias remains strongly bearish on this timeframe, so the sellers will
keep on stepping in at every notable resistance to ultimately targeting new
lows.

WTI Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that this latest
leg lower is diverging with the
MACD which is
generally a sign of weakening momentum often followed by pullbacks or
reversals. We can also notice that this formation resembles the one from
November when we got the pullback into the swing high and then the big selloff.
If that’s the case, we can expect the sellers to pile in around the swing high
at $72 to position for another drop into the cycle low at $64 with a great risk
to reward setup.

WTI Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
price yesterday broke below the swing low, retested it and then continued
lower. The price is now coming back into the swing low level, and we can expect
some aggressive sellers to step in once again with the red 21 moving average acting
as dynamic resistance. If the price breaks higher though, the buyers are likely
to pile in and position for a rally into the resistance at $72
where we will find once again strong sellers.

Upcoming Events

Today, we have the US PPI data followed by the FOMC
rate decision where the Fed is expected to keep interest rates unchanged. Tomorrow,
we will see the latest US Retail Sales and Jobless Claims figures, while on
Friday we conclude the week with the US PMIs. Strong data might support Crude
Oil in the short term, while weak figures could weigh on it further.

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