WTI Crude Oil Heading for $70 After Reversing at the 50 SMA on the Monthly Chart
Skerdian Meta • 1 min read
US WTI Crude Oil turned quite bearish in 2014 and 2015, but in 2016 it made a bullish reversal and climbed higher in the following years, until late last year, when it found solid resistance at the 100 SMA (green) on the monthly chart. Crude oil pierced that moving average briefly, but returned down in October, as it became increasingly evident that the global economy was heading for some rough times.
The decline was quite steep, but OPEC+ decided to cut production by placing quotas on the member countries, which helped the price in Crude Oil. But, the trade war escalated further this year and the global economy weakened further, which dampened the demand for energy.
Crude Oil turned bearish again this year, but US WTI Oil found support at the 50 SMA (yellow). The price has pierced this moving average several times, but buyers got active above the big round level at $50 and we had no break of the 50 SMA, since no candlestick closed below it.
In October, the price formed a doji candlestick above the 50 SMA, which is a bullish reversing signal and WTI turned bullish in November. OPEC+ decided to cut production further, by place in additional quotas for 50k barrels/day and Oil turned even more bullish this month. WTI broke above the $60 level and now the price is heading for the 100 SMA at $70.