Sideways Channel in Crude Oil – Wait for a Breakout

WTI crude oil prices slipped over sentiments that demand for energy products are set to get a hit over an economic slowdown. During the early Asian session, crude oil prices dropped due to the economic slowdown that has begun to depress energy demand, but markets got some help after Saudi Arabia said an agreement was emerging with other producers about continuing supply cuts.

The West Texas Intermediate (WTI) crude trades at $53.05 per barrel, falling 0.4%, from the last settlement. Overall, crude oil is around 20% below 2019 highs reached in late April, with May posting the first monthly drops since November.

On the flip side, ither energy prices, like coal and gas, are also being walloped by the downturn. Tanker brokerage Eastport said on Tuesday that the continued trade war has raised concerns of a global economic slowdown as well as weaker oil demand.

Support Resistance
51.11 57.72
48.8 62.03
42.19 68.64
Key Trading Level: 55.42

Technically, crude oil hasn’t changed much from yesterday. The support still stays at 52.50 along with resistance at 55. On the downside, a bearish breakout could lead oil prices towards 51.65 and 51.

Whereas, the bullish breakout could open further room for buying until 56.10 today.

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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