WTI oil futures (November delivery) are flirting again with the 2018 high of 76.87 thanks to the 20-day simple moving average (SMA), which has been assisting the commodity on the way up since the quick bounce near the 61.77 support area on August 23.
After a non-stop four-week-old rally, a downside correction might be on the cards, especially as the 50% Fibonacci retracement of the 2008 – 2020 downtrend at 76.80 is cementing the 2018 ceiling.
That said, the momentum indicators are keeping the bias on the positive side, suggesting there is still some bullish fuel in store before the next bearish round starts. Specifically, the RSI is maintaining its upward direction below its 70 overbought mark and the MACD continues to stretch upwards comfortably above its zero and signal lines.
If the wall around 76.87 collapses, the price could advance towards the 80.00 psychological mark, last seen in September 2014. A move higher from here could take a breather within the 83.45 – 86.45 restrictive zone before the 90.00 round-level comes under the spotlight.
Alternatively, the red Tenkan-sen line at 73.08 and the 20-day SMA at 71.47 may resume their supportive role if negative pressures resurface. Failure to hold above the latter could trigger a sharper decline towards the 67.35 handle, while lower, the 200-day SMA currently at 64.33 could come to the rescue, preventing a test of the August low of 61.77. Any step lower from here would further dampen confidence in the long-term uptrend.
Summarizing, WTI oil futures are trading at a crucial long-term resistance territory, strengthening the odds for a downside reversal, but the technical picture is still keeping optimism alive.
Forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors.
Recommended Content
Editors’ Picks
AUD/USD remains under pressure above 0.6400
AUD/USD managed to regain some composure and rebounded markedly from Tuesday’s YTD lows in the sub-0.6400 region ahead of the release of the Australian labour market report on Thursday.
EUR/USD faces decent contention around 1.0600
The knee-jerk in the Greenback reignited some buying interest in the risk complex and pushed EUR/USD to three-day highs near 1.0680, rapidly leaving behind the recent yearly low around 1.0600.
Gold eases despite risk-off mood
Gold trades in a relatively tight range near $2,390 in the second half of the day on Wednesday. In the absence of high-tier data releases, investors keep a close eye on headlines surrounding the Iran-Israel conflict.
Ethereum trades around the $3,000 support following a surge in validator queue
Ethereum (ETH) continued a sideways movement on Wednesday as investors seemed to be waiting for an upward or downward price catalyst. Despite the price stagnancy, the ETH validator queue - possibly fueled by the DeFi restaking boom - rose sharply.
Australia unemployment rate expected to rise back to 3.9% in March as February boost fades
Australia will publish its monthly employment report first thing Thursday. The Australian Bureau of Statistics is expected to announce the country added measly 7.2K new positions in March after the outstanding 116.5K jobs created in February.