Crude Oil Bearish Channel Drives Selling – Quick Trading Signal
On Monday, WTI crude oil prices trade bearish in the wake of weaker Chinese economic outlook. Although, the manufacturing data improved, amidst a continuing trade war with the United States counting on demand growth for the worldβs largest crude importer.
Earlier today, Chinaβs official Purchasing Managersβ Index (PMI) climbed to 49.8 in September, slightly better than anticipated and improving from 49.5 in August.
Additionally, one of the major crude oil exporters, Saudi Arabia, has recovered the capacity to 11.3 million barrels per day following an assault on its oil processing facilities this month. Consequently, traders are doing profit taking, driving crude oil prices lower.
A drop in oil prices are never liked by Saudi Arabia and the US President Trump. Perhaps thatβs the reason why Saudi Arabiaβs Crown Prince Mohammed bin Salman signaled in an interview that crude oil rates could surge to βunimaginably high numbersβ if global economies donβt deter Iran. However, the haven remained in check as Saudi Prine would prefer a political solution to a military one.
WTI Crude Oil β Technical Outlook
On the 2 hour timeframe, crude oil is trading in the bearish channel below 55.60 area. WTI has formed three black crows on the 2-hour chart, which is suggesting bearish bias in the black crack.
On the lower side, the immediate support that crude oil faces is at 54.50 area. Itβs also a double bottom area which can bring some buyers near 54.50 trading zone.
WTI Crude Oil β Technical Levels
Support Resistance
55.01 57
53.88 57.85
51.89 59.84
Key Trading Level: 55.86
WTI Crude Oil β Trading Signal
Crude oil is trading at 54.40 level, and it has an excellent potential to drop until 54. Therefore, we have opened a trading signal to stay bearish until 54 today.
Good luck!
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