U.S. crude oil prices just popped up a red candlestick around a key inflection point!
Are we looking at Black Crack potentially extending its long-term downtrend?
The 4-hour chart may give us more clues:
WTI Crude Oil (USOIL) 4-hour Chart by TradingView
In case you missed it, increased geopolitical tensions in the Middle East, optimism over lower U.S. interest rates, and tighter global supply have helped prop up U.S. crude oil prices in the last few days.
WTI crude (USOIL), which hit bottom near $65.25 last week, is now trading closer to the $70.00 mark.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on crude oil and market sentiment, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
But that was yesterday. USOIL looks like it hit a ceiling near $70.50, which lines up with a mid-channel resistance in the 4-hour time frame.
The potential resistance area is more interesting because it’s not too far from the 38.2% – 50% Fib retracement area and the R1 ($71.23) Pivot Point line on the chart.
Is USOIL ready to extend its downtrend?
We’re keeping close tabs on the current red candlestick to see if the bearish momentum is sustained below the $70.00 handle. A move to the $66.25 previous lows may be in the cards if USOIL continues to see bearish pressure.
An extended upswing isn’t out of the table either.
Look out for bullish candlesticks and consistent trading above $72.00 and the 100 and 200 SMAs. Green candlesticks above the potential resistance zone could set USOIL up for an upside breakout and a retest of the $76.00 and $78.00 previous areas of interest.