WTI Price Analysis: Correction to near $90.00 make place for smart money
- The oil prices have slipped to near $90.00 as DXY bulls have attempted recovery in Asia.
- Advancing 50-and 100-EMAs add to the upside filters.
- Corrective moves are considered an entry area of smart money in a Rising Channel formation.
West Texas Intermediate (WTI), futures on NYMEX, have extended losses in the Tokyo session after surrendering the immediate support of $90.90. The black gold has witnessed selling interest as the US dollar index (DXY) has displayed signs of recovery amid anxiety ahead of US mid-term elections.
On an hourly scale, the black gold is auctioning in a Rising Channel chart pattern that indicates an upside structure. The upper portion of the chart pattern is placed from October 20 high at $86.94 while the lower portion is plotted from October 31 low at $84.78.
The asset has corrected to near the 50-period Exponential Moving Average (EMA) at $90.70, while the 100-EMA at $89.80 is still untouched and is aiming higher, which indicates more upside ahead.
Meanwhile, the Relative Strength Index (RSI) (14) has shifted into the 40.00-60.00 range and is likely to find support around 40.00.
Going forward, a drop near the horizontal resistance placed at Wednesday’s high of $89.66 will act as a buying opportunity for the market participants. Bulls may drive the oil prices toward Tuesday’s high at $91.40, followed by Monday’s high at $92.92.
On the flip side, the oil prices could face a sheer downside to near Wednesday’s low at $87.00 if they drop below the round-levels support of $89.00. A slippage below Wednesday’s low may drag the asset further toward October 31 low at $84.78.
WTI hourly chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
