Amazon deals

Tuesday, April 18, 2017

WTI and Brent Crude Oil charts: bull rallies stop just short of their previous tops

WTI Crude Oil chart


The daily bar chart pattern of WTI Crude Oil had formed a 'triple-bottom' reversal pattern at 47 last month. Reversal patterns had also formed on daily technical indicators. 

That was a trigger for a sharp rally that took oil's price well above its three EMAs into bull territory. The 20 day EMA has crossed above the 50 day EMA, and all three EMAs are moving up - which is a bullish sign.

However, on Apr 12, oil's price rose above 53.50 but fell just short of its previous (Mar 7) top and the 54 level. It formed a 'reversal day' bar (higher high, lower close) that often marks an intermediate top.

Daily technical indicators are in bullish zones, but not showing any upward momentum. RSI has started correcting after facing resistance from the edge of its overbought zone. Slow stochastic is sliding down inside its overbought zone.

A fall below 52 can take oil's price down below its 20 day and 50 day EMAs to the next support level of 50.

US shale oil output is expected to post the biggest monthly increase in two years, raising concerns of undermining efforts to cut oversupply by OPEC countries.

On longer term weekly chart (not shown), oil's price has crossed above its 20 week and 50 week EMAs but closed well below its falling 200 week EMA in a long-term bear market. Weekly technical indicators are in bullish zones, but only Slow stochastic is showing some upward momentum.

Brent Crude Oil chart


After forming a small 'double bottom' reversal pattern at 50, the daily bar chart pattern of Brent Crude Oil rallied sharply to climb above its three EMAs into bull territory.

On Apr 12, oil's price rose to test its previous (Mar 7) top but fell just short and closed lower - forming a 'reversal day' bar (higher high, lower close) that appears to have ended the rally.

Daily technical indicators are in bullish zones, but have started to correct. Oil's price can drop below its 20 day and 50 day EMAs to the support level of 53.

With financial companies investing billions to increase US shale oil production, Arab Sheikhs may be gradually losing control of the oil market.

On longer term weekly chart (not shown), oil's price has closed above its 20 week and 50 week EMAs but well below its falling 200 week EMA in a long-term bear market. Weekly technical indicators are in bullish zones, but only Slow stochastic is showing some upward momentum.

No comments: