Crude Oil has been bearish since June when the US WTI crude reversed above $123 and sellers have been in total control. Moving averages have been doing a good job as resistance, ending the retraces higher and pushing the price lower eventually, as US crude Oil fell to $76.20s. Although, in the last week we have seen a decent retrace higher in crude Oil, pushing the price above the 20 SMA (gray) on the daily chart.

US WTI Oil Daily Chart – Stochastic Is Almost Overbought

Will the 50 SMA hold as resistance again?

But, this move has been mostly an attribute of a weaker dollar and crude Oil has benefited from it. Otherwise, the global economy is still heading into a recession and the latest US data has softened up considerably. So, we’re looking to open a long-term sell signal in WTI Oil at the 50 SMA (yellow) if it holds as resistance. Although, we’re following the dollar index DXY since it continues to crash lower, but might stop at the 50 SMA as well.

USD Index DXY Daily Chart – Heading to the 50 SMA

The 20 SMA has been broken

The Kuwait Oil minister said that the OPEC+ decision will aim to guarantee supply security, which is a bearish comment for Oil. Mohammed al-Fares said on Tuesday that OPEC+ would make a suitable decision to both guarantee energy supply and serve the interests of producers and consumers.

He made his comments before departing for the OPEC+ meeting which is taking place in person in Vienna on Wednesday for the first time since March 2020, the state news agency KUNA said. Expectations are that OPEC will be looking for a 1M to 1.5M barrels per dad cut in the output. But, the market will react based on the difference between expectations and realities, though I’m sure you’re all very aware of that by now.

The OPEC+ meeting is today and expectations have been growing. We started a week ago with rumors of 500,000 barrels per day and it continues to climb. There’s a strong signal that OPEC wants crude Oil above $80. They believe not enough money is being invested/made to supply the world; or they’ve had a taste of $100 Oil and like it.