Crude Oil climbed above $95 a while ago, ahead of a meeting of OPEC+ producers tomorrow that may or may not lead to a further boost in the Oil supply, although the concerns about a possible global recession keep limiting gains. Sellers also tested the downside but the two moving averages continue to hold as support and resistance and the range is getting tighter for Oil. There are still supply concerns, but with the global economy falling into a recession, the demand problems are higher, which means that the breakout will probably take place on the downside. We continue to remain bearish on Oil, selling the retraces higher.
Bearish Breakout Expected in Crude Oil, As MAs Squeeze the Price
Crude Oil is bouncing up and down between 2 MAs, as uncertainty about supply and demand still prevails in the market
Skerdian Meta•Tuesday, August 2, 2022•2 min read
Crude Oil was bullish for two years, with the US WTI coming back from the dead as it fell to $-37.50 in April 2020 at the peak of the first coronavirus wave and the big closure. The price touched $130 in March this year and buyers kept the pressure up for some time, but by the middle of June crude Oil started to turn bearish and the selling pressure remains decent.
Prices of the barrel of the US WTI crude dropped to the lowest level in more than two weeks yesterday to $92.50 where the 200 SMA (purple) was waiting on the daily chart, which it retested today again. Against that, the commodity could see its decline accelerated in the very near term and with the immediate target at the July 14 low of $90.58 per barrel.
Considering preliminary readings from the CME Group for Oil futures, traders increased their open interest positions for the third straight session at the beginning of the week, this time by around 11.5K contracts. Volume followed suit and added around 89.3K contracts to the previous daily build.
Crude Oil Daily Chart – The 200 SMA Keeps Holding As Resistance
The 20 SMA has turned into resistance at the top
US WTI Crude Oil Live Chart
WTI
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Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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