WTI Technical Analysis: Off 3-month highs, trapped in a rising wedge
- WTI is rapped in a rising wedge on the hourly chart
- A break below $59.21 would confirm a wedge breakdown.
- A close above $59.81 would imply bullish continuation.
WTI oil is currently trading at $59.83 per barrel, having hit a high of $60.45 on Friday. That was the highest level since Sept. 17.
The hourly chart shows the black gold is trapped in a rising wedge, which comprises converging trendlines connecting higher highs and higher lows. The converging nature of trendlines indicates buyer exhaustion.
As a result, a wedge breakdown is considered a bearish reversal sign.
At press time, the lower edge of the wedge is seen at $59.21. An hourly close lower would imply an end of the rally from lows near $55.30 and open the doors for a drop to support at $58.00.
On the flip side, a convincing close above the Dec. 6 high of $59.81 would signal a continuation of the rally.
It is worth noting that WTI on Friday clocked a three-month high of $60.45, but failed to close above $59.81. The rejection of higher prices indicates bull exhaustion and scope for a drop to the wedge support of $59.21.
Trend: Bearish below $59.21
Technical levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
