Support Becomes Resistance – Is It Good Time to Sell Crude Oil?

Crude oil is testing 20 periods EMA which is providing a solid resistance to $71.85. Crude oil has formed a shooting star candlestick...


What’s up, traders,

It’s been a good day so far as team FX Leaders managed to capture four winning forex trading signals to close the week in green. Are you ready for the next trade?

Well, I was looking at the WTI crude oil chart when I noticed that crude oil has completed 61.8% retracement at $71.85 and now it’s trading right below this level. The same level worked a pretty strong support on Thursday before it got violated on bearish EIA report.

The inventories report showed a build of more than 5 million barrels for the previous week, which clearly signals China and the US trade war seems to impact crude oil demand.

At the moment, crude oil is looking bearish for three reasons:

  • Crude oil is testing 20 periods EMA which is providing a solid resistance to $71.85.
  • Crude oil has formed a shooting star candlestick pattern right below the major resistance level of $71.85.
  • The Stochastics is also trading in the overbought zone. Which means, we may see bulls getting out of the market now.

Crude Oil – Trade Idea

The idea is to stay bearish below $71.85 with a stop above $72.25 to target $71.25 and $70.85. Good luck!

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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