WTI Crude Oil Technical Analysis | Forexlive

Crude Oil continues to be
supported amid a confluence of positive supply and demand drivers although the
strong momentum from the beginning of the month faded ahead of the key $80
level. 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, Reuters reported yesterday that OPEC+ may extend the
voluntary output cuts into Q2 or even into year end.

On the demand side, the
recent economic data has been showing a reacceleration in activity which is
supported by the rate cuts expectations and the end of the tightening cycle. On
top of that, China finally started to take more decisive actions with the PBoC recently
surprising with a bigger than expected RRR cut and with the biggest 5-year LPR cut ever.

WTI Crude Oil
Technical Analysis – Daily Timeframe

On the daily chart, we can see that Crude Oil lost
some momentum recently ahead of the key $80 resistance and
started to consolidate just below it. The buyers have been leaning on the red
21 moving average to
position for a breakout with a better risk to rewards setup. The sellers, on
the other hand, continue to defend the
resistance with a tight risk above it targeting a drop into the major trendline.

WTI Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see more clearly the
rangebound price action just beneath the key resistance zone. The price is now
trading right around the resistance, so we can expect the sellers to start
piling in to target a drop into the 75.57 support. The buyers, on the other
hand, will want to see the price breaking higher to increase the bullish bets
into new highs, but if the price were to pull back again from here, we will
find them at the 75.57 support.

WTI Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the price now near a trendline where we
can also find the confluence of the
red 21 moving average and the Fibonacci
retracement levels. This is where the buyers are
likely to step in with a defined risk below the trendline to position for the
break above the key resistance. The sellers, on the other hand, will want to
see the price breaking lower to invalidate the bullish setup and target the
75.57 support.

Upcoming Events

Tomorrow we will see the US PCE and the latest US
Jobless Claims figures. On Friday, we conclude the week with the US ISM
Manufacturing PMI. Weak data is likely to weigh on Crude Oil in the short term
while strong data should give it a boost.

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