Ready to Sell the Retrace Higher in Oil at the 20 SMA
Crude Oil has lost $7.5 this month, but it is retracing higher now, which we plan to sell
Crude Oil has been bullish since April, after Saudis failed to destroy the US Oil industry, when they flooded markets with cheap Oil, despite the OPEC+ deal to cut output. US WTI crude fell to -$37 back then, but reversed back up and has remained bullish since the, climbing to $43.50.
Although, the pace of the climb slowed considerably during the last couple of months. The volatility also declined, which seemed strange, considering that financial markets have been quite volatile during this period, while crude Oil wasn’t minding anything, consolidating between $40 and $43.50.
Although, it started making a bearish reversal earlier this month, which picked up pace further this week. US crude Oil fell to $36, meaning a 7.5 cent decline from the top, but this area has provided support before and did so again today. The price bounced $1.50 from that level, but the 20 SMA is catching up now on the H4 chart. This moving average pushed the price lower today and it is likely that it turns into resistance again, so I am thinking about opening a sell signal when the 20 SMA catches up with the price.
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