Crude Oil Prices Gain Amid USD Softness, Bulls Eye Key Trendline Resistance


OIL PRICES FORECAST

  • Oil prices rally, extending their recovery that began last week
  • Technical signals are not yet overly bullish, but the situation could improve
  • Trendline resistance crossing by the $91.00 area in focus in the coming days

Trade Smarter – Sign up for the DailyFX Newsletter

Receive timely and compelling market commentary from the DailyFX team

Subscribe to Newsletter

Most Read: Crude Oil Price Dodges US Dollar Strength Post US CPI Surprise. Will WTI Rally?

Oil prices rose on Wednesday amid U.S. dollar softness in the currency market, extending their recovery that began last week after bouncing off long-term trendline support and a key Fibonacci retracement level located in the $82.00 area. At one point in the trading session, WTI crude was up about 3.4% to $90.2, its best level since September 6, but then trimmed some of those gains to trade slightly above $89.00 per barrel.

From a price action standpoint, bulls still have some reasons to be concerned. First off, oil has been making lower highs and lower lows since June, a negative sign for the commodity. At the same time, we have seen the formation of a death cross on the daily chart, a pattern typically viewed as bearish by technical analysts.

To be confident that the downward correction that has unfolded over the past few months has come to an end, we need more positive technical signals to develop. One of these, and perhaps a significant one, could come from a higher high that takes out the August peak, but we are still far from that point: one day at a time for now.

Recommended by Diego Colman

Get Your Free Oil Forecast

OIL KEY TECHNICAL LEVELS

In any case, oil prices seem to be approaching a pivotal resistance near the $91.00 handle after the recent advance, a ceiling created by a descending trendline in play for three months. If we see a clear move above this barrier in the coming days, breakout traders could jump back in, reinforcing upside momentum and launching an attack on the 200-day simple moving average. On further strength, the focus shifts to the August swing high at $97.66, the line in the sand that may determine the near-term trend.

On the flip side, if sellers, speculating on the weak economic outlook and increased uncertainty, resurfaced to trigger a bearish reversal, initial support sits at $85.50. If this floor is breached on weekly closing prices, the next one to watch appears around the $82.00 region, as mentioned above. If the bulls fail to defend this zone, sentiment could quickly worsen, paving the way for a pullback towards the $78.00 area.




of clients are net long.




of clients are net short.

Change in Longs Shorts OI
Daily -12% 24% 1%
Weekly -40% 55% -18%

WTI CRUDE OIL TECHNICAL CHART

WTI Oil Chart Prepared Using TradingView

EDUCATION TOOLS FOR TRADERS

  • Are you just getting started? Download the beginners’ guide for FX traders
  • Would you like to know more about your trading personality? Take the DailyFX quiz and find out
  • IG’s client positioning data provides valuable information on market sentiment. Get your free guide on how to use this powerful trading indicator here.

—Written by Diego Colman, Market Strategist for DailyFX





Source link

Related articles

CoinShares Experiences $1.9B in Weekly Crypto Inflows, Ethereum Leads the Pack

Trusted Editorial content material, reviewed by main trade specialists and seasoned editors. Advert Disclosure The digital asset funding area maintained its upward trajectory final week, with inflows into crypto funding merchandise reaching $1.9 billion,...

Harmonic, an AI math startup co-founded by Robinhood CEO Vlad Tenev, unveils its mannequin Aristotle, saying it achieved gold medal efficiency on the 2025...

Featured Podcasts Techmeme Journey House: Tea Has Been Spilt The day's tech information, on daily basis at 5pm ET. Fifteen minutes and also you're updated. Subscribe to Techmeme Journey House. Sponsor this podcast Decoder with Nilay Patel: ChatGPT could be...

Overbought Market Meets Rising US Greenback and Tightening Liquidity

Shares completed largely decrease, with the equal-weight Invesco S&P 500® Equal Weight ETF (NYSE:) down about 60 bps, whereas the market-cap-weighted index closed flat. In the present day kicked off what needs to...

FYNXT Hires StoneX Veteran Camila Pinto as Industrial Director for UK and LATAM

Singapore-based know-how supplier for brokers FYNXT appointed Camila Pinto because the Industrial Director for the UK and LATAM. Pinto is answerable for, amongst different duties, shopper acquisition throughout the areas.“After 15 years in Monetary Companies,...

#9 – “Establishments Cannot Beat A Primary Purchase and Maintain Allocation” – Meb Faber Analysis

Pension funds’ annualized mixture returns since 2000 have been...
spot_img

Latest articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

WP2Social Auto Publish Powered By : XYZScripts.com