Crude Oil Forecast: Technical Correction or Reversal
Some fundamentals and technicals are indicating a bearish move in Crude Oil prices.
Crude Oil rally, from 40 USD to 65 USD triggered by the OPEC cuts seems like losing its strength.
Negative Fundamentals of Crude Oil:
Russia does not seem to be willing to make new supply interruptions
The possibility that China’s future 4th-quarter growth data may not meet expectations tomorrow may push prices down. ( Data will be released tomorrow )
Global demand: Oil markets are heavily dependent on demand and supply talks. There are no strong significant evidence of Global demand.
US Drillers: One of (if not the biggest) the contributors to the downfall in oil prices in recent years. Higher prices and more shale production. It is a question mark.
On the H4 chart, we can see that the price is testing the rising trendline resistance. An SHS formation appears.
Crude oil needs to make H4 closings above 64.10 to continue its bullish move. Price will remain under bearish pressure as long as it holds below 64.10.
The current level is 63.73. The break out of the trend line ( we can say an hourly closing below 63.50 ) will carry the price towards 63.20 and 62.50.
62.50 is the main support.
I suggest watching 64.10 resistance. If the price can not make H4 closing above the resistance we may see a bearish move towards 62.50.
We have reached the first target with 120 pips.
We have published an update and you can read it:
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Warning: All markets trade in different phases; bull and bear markets don’t start overnight. Markets build through three major phases and depending on the time frame you are trading, you will see different phases.
If you enter a trade by analysing the H4 chart frame, this is just a day trading, your stop loss and take profit levels must be set up accordingly.
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- All markets trade in different phases; bull and bear markets don’t start overnight. Markets build through three major phases and depending on the time frame you are trading, you will see different phases. If you enter a trade by analysing the H4 chart frame, this is just a day trading, your stop loss and take profit levels must be set up accordingly