Oil has been on a blissful rise to the upside since midyear June 2023. Prices skyrocket from $69 a barrel to highs of 82 Dollars a barrel.
Currently, The price of Crude oil is $79 and the price of Brent is 83 dollars. We can see that the market trend has changed and the uptrend has now turned bearish. In this article, we will be looking at purely the technical elements on the daily chart, affecting the market to get a comprehensive understanding of the market direction.
Firstly we see that the Crude Oil prices hit a level of resistance of around 82 Dollars a barrel when we look left at past data, we can see that this price level has been tested multiple times so we know that this is a strong psychological demand level. Here are key indicators to indicate that the market might be heading for a retracement:
1)Resistance Level-We can see that this is a valid resistance level because the price has been rejected at around this price more than 3 times.
2)Bearish divergences-The market making higher highs but the stochastic oscillator is making even highs (See blue lines)
3)Bearish Bat/Gartley Pattern- There is a 5 points bearish pattern that is completed. indicated in blue. This W pattern can be considered as a Gartley or a Bat pattern, either way, it is a bearish indication.
5)Bearish Harami- On TUE 01 Aug after the market closed with a green body, The market had a small gap to the downside, then formed a small red body candle. This tells us the market is pregnant and down movement is approaching.
5)Engulfing Pattern- After the Bearish Harami. the market gapped to the upside before forming a big red candle that engulfed the small red candlestick.
What to expect?
The overall outlook on oil is for the price to keep its way up and this down movement is a temporary retracement from the up movement it has been on. We need to look at key levels where the market can find support. These are levels to take profits or look for possible entries to the upside. The first level $75 is a strong psychological level because of the Number of rejects at that price, It is the start of the window or gap that appears in the past and also It is the 50% retracement of the Cd leg.
The next level would be $72 because it is the 6.18 retracement for leg CD. If the rejection is found here, we could be looking at a possible AB=CD Pattern to the upside.
The last price to take profit on the sell position would be at $66 which is 100% retracement of the line CD
The market is in a big range moving up and down with bands at the top and the bottom. Right now the market is at the top part of the band and is facing rejection. Keep in mind that nothing in the market is certain and you should trade with caution and risk management strategy.
Currently, The price of Crude oil is $79 and the price of Brent is 83 dollars. We can see that the market trend has changed and the uptrend has now turned bearish. In this article, we will be looking at purely the technical elements on the daily chart, affecting the market to get a comprehensive understanding of the market direction.
Firstly we see that the Crude Oil prices hit a level of resistance of around 82 Dollars a barrel when we look left at past data, we can see that this price level has been tested multiple times so we know that this is a strong psychological demand level. Here are key indicators to indicate that the market might be heading for a retracement:
1)Resistance Level-We can see that this is a valid resistance level because the price has been rejected at around this price more than 3 times.
2)Bearish divergences-The market making higher highs but the stochastic oscillator is making even highs (See blue lines)
3)Bearish Bat/Gartley Pattern- There is a 5 points bearish pattern that is completed. indicated in blue. This W pattern can be considered as a Gartley or a Bat pattern, either way, it is a bearish indication.
5)Bearish Harami- On TUE 01 Aug after the market closed with a green body, The market had a small gap to the downside, then formed a small red body candle. This tells us the market is pregnant and down movement is approaching.
5)Engulfing Pattern- After the Bearish Harami. the market gapped to the upside before forming a big red candle that engulfed the small red candlestick.
What to expect?
The overall outlook on oil is for the price to keep its way up and this down movement is a temporary retracement from the up movement it has been on. We need to look at key levels where the market can find support. These are levels to take profits or look for possible entries to the upside. The first level $75 is a strong psychological level because of the Number of rejects at that price, It is the start of the window or gap that appears in the past and also It is the 50% retracement of the Cd leg.
The next level would be $72 because it is the 6.18 retracement for leg CD. If the rejection is found here, we could be looking at a possible AB=CD Pattern to the upside.
The last price to take profit on the sell position would be at $66 which is 100% retracement of the line CD
The market is in a big range moving up and down with bands at the top and the bottom. Right now the market is at the top part of the band and is facing rejection. Keep in mind that nothing in the market is certain and you should trade with caution and risk management strategy.