Slightly Bullish Bias On Non-Committal WTI Crude Oil

Posted Thursday, April 5, 2018 by
Shain Vernier • 1 min read

May WTI crude oil futures are trading with huge volumes. Thus far in the early U.S. session, over 400,000 contracts have changed hands. About half of that volume has come in since the traditional crude oil pit open at 9:00 AM EST. When taken in context with compression on the 60- minute chart, this market is preparing to move.

Yesterday’s dismal EIA stocks report gave bulls something to cheer for, showing a considerable draw on supply. The optimism fueled early-session buying. Is crude oil going to trend higher as we roll toward the weekly close? Let’s take a look under the hood and find out.

WTI Crude Oil Technicals

The heavy volumes in WTI have created optimal trading conditions for extremely short-term scalping. In such a liquid and deep market, use of 5-minute and 1-minute charts often provides positive risk/reward scenarios. Below is a view of the aggregate WTI market on the daily timeframe.

May WTI Crude Oil (CL), Daily Chart

Here are the key levels for the remainder of today’s session:

  • Resistance(1): Round Number, $64.50
  • Resistance(2): Psyche Level, $65.00
  • Support(1): Bollinger MP, $63.24
  • Support(2): Daily SMA, $62.24

Overview: Until price sustains action beneath the Bollinger MP, I will have a bullish view of this market. The heavy volumes and relatively tight daily range are signals of a pending break-out. As long as the $63.24-$63.00 area holds up as support, it will likely be to the bull.

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