Bullish Trendline Support & Doji Pattern In WTI Crude Oil – Swing Trade Plan
Crude oil continues to trade bearish on concerns that global trade conflicts will reduce economic growth and market for fuel. But the sell-off remained limited by US sanctions on Iran which can cause a reduction in crude oil supply from the OPEC’s third-biggest crude oil producer.
WTI Crude Oil – Technical View
The technical side of the market has turned from extremely bearish to neutral. On the daily timeframe, the bullish trendline is providing a solid support near $66.14 and interestingly, crude oil has closed a doji candle right above this level.
For all the newbies, doji candle represents a neutral sentiment of investors. However, when the doji pattern is followed by a strong bearish reversal represents, it signals that the bears are exhausted and we may have bulls looming around the corner. Crude oil is also holding in an oversold region. The series of doji and spinning top candlestick patterns are suggesting a potential of a bullish retracement.
Referring to FX Leaders Aug 10 – Economic Events Brief, we spoke about the US inflation data. Yes, the US CPI figures can also influence crude oil prices. Confused? Just like gold, the dollar also shares a negative correlation with crude oil prices. Therefore, a strength in the dollar makes crude oil costlier for the rest of the world. UItimately traders diminish the demand and prices fall down.
Support Resistance
1207.01 1224.59
1201.59 1230.01
1192.8 1238.8
Key Trading Level: 1215.8
Crude oil is likely to bounce off the trendline support area of $66.35 to target $67.50. Whereas, the bearish breakout can lead oil prices towards $64.75. Let’s see what US inflation figures bring us. Good luck!
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