Crude Oil Slips Over Fundamentals, Can Technicals Support Today?
WTI crude oil prices were mixed on Thursday with US crude extending losses after dropping in the previous session after data showed that US stockpiles of products like gasoline rose sharply last week, hinting soft demand during the top driving season.
The Energy Information Administration announced in its weekly report that WTI crude oil inventories were declining by 3.12 million barrels during this week, At the start of this week, WTI crude oil prices were under pressure after reports that the US and Iran could hopefully start talking soon, reducing concerns in the Middle East. Iran later dismissed the statement.
Oil prices also slipped after the US Secretary of State Mike Pompeo remarked that it’s the very first time that the Iranian official is ready to negotiate on the missile plan.
On the trade front, President Donald Trump also warned to impose additional tariffs on Chinese goods. As of writing, this news could impact the WTI crude oil prices.
Technically crude oil has violated the ascending triangle pattern which was supporting oil prices at $59. Recalling the bearish marubozu candle on the 4-hour timeframe, it triggered further sell-off just the way we expected.
Oil prices are already below 50 and 100 periods EMA which are extending resistance at $58.50. It may find support around $56 now.
Support Resistance
56.46 59.44
55.33 61.29
52.35 64.27
Key Trading Level: 58.31
Today, the idea is to stay bullish above $56 with a stop loss over $55.75 and take profit around $52.20 and $57.50.
Good luck!
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