AB=CD for Oil?

Aaron Hill FP Markets

I have opted for a keep-it-simple approach for oil (WTI) today.

As you can see on the daily timeframe, we have been working with a defined downtrend in oil since price chalked up a top at $121.31/bbl in June 2022. Interestingly, the downtrend offered several sell-on-rally scenarios should one have faded the lower side of the upper Bollinger Band (set to 2 standard deviations using the default 20-period simple moving average).

AB=CD Pattern Unfolding on the Daily Chart?

Early last week witnessed price movement probe lows of $64.35, a move that came within striking distance of clipping the $62.31 2 December low (2021) and also invaded territory outside the lower Bollinger Band. Since then, we have observed a moderate recovery unfold, moulding what many Harmonic traders will recognise as a potential AB=CD bearish formation (price is currently forming the D-leg).

Overhead Technical Confluence in View

Joining the 100% projection at $74.33 (which marks the AB=CD resistance), chart studies have thrown the following technical structure in the mix: an ascending support-turned-resistance taken from the low $70.24, a 61.8% Fibonacci retracement at $74.66, two horizontal resistance levels at $75.31 and $72.73 as well as the 20- period simple moving average (marks the inner band of the Bollinger Band’s construction).

Consequently, the combination of technical tools between $75.31 and $72.73 could be an area sellers target in this market to perhaps try for fresh lows, in line with the current downtrend.

Author

Aaron Hill

FP Markets

After completing his Bachelor’s degree in English and Creative Writing in the UK, and subsequently spending a handful of years teaching English as a foreign language teacher around Asia, Aaron was introduced to financial trading,

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.