Crude Oil Prices Edge Lower – a Quick Analysis & Trade Plan
A stronger dollar was holding crude oil prices in line because of its negative correlation with commodities. How it's likely to trade today?
A stronger dollar was holding WTI crude oil prices in line because of its negative correlation with commodities. But recently, the energy sector is reacting and most of the movement is on the upper side. It’s mostly due to a sharp drop in the US retail sales which is making the dollar weaker and oil bullish.
On the fundamental side, the remarks from Jihad Azour, Director of the Middle East and Central Asia Department at the International Monetary Fund (IMF), are supporting crude oil prices. By the way, he stated that the OPEC’s biggest producer Saudi Arabia would require oil prices at $80-$85 per barrel to balance its 2019 budget.
- The technical indicators are now weighing on oil prices. For instance, you can see that a bearish trendline on the 3-hour chart is providing strong hurdle at $55.
- The leading indicator, relative strength index, is signaling that bulls are exhausted and they may trigger profit taking before placing further buying bets.
Support Resistance
53.84 55.4
52.88 55.99
51.33 57.54
Key Trading Level: 54.44
Consider staying bearish below $55 with a stop above $55.30 and take profit at $53.85.
Good luck!
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