Crude Oil Resuming Decline After Failing at MAs

Crude Oil turned bearish in June last year as the FED picked up the pace of rate hikes, which headed the US and global economy toward a recession, and US WTI Oil fell to $70 lows in December, where it formed a support zone above that big level. Since then we have seen crude Oil bounce up and down in a range, and this week we saw a bullish move, with the price heading higher, although the move might be over now.

Comments from the Federal Reserve chairman Powell on Tuesday helped with the uptrend, as they eased the worries about future interest rate hikes. Less aggressive rate hikes by the FEDF are seen as positive for the US economy which will likely dodge a recession that would slow the demand for crude Oil. Besides that, the end of COVID-zero policy in China should also support demand for Oil and other energy products.

WTI Oil Daily Chart – The 50 SMA Providing Resistance

MAs Keep Pushing the Highs Lower 

Although, the uncertainty remains high, with the FED leaving the monetary policy path at the mercy of the economic data. So, buyers are not confident enough and they seem to be shifting their positions in WTI crude Oil, which is helping sellers push the price lower.

The 50 SMA (yellow) is also doing a good job as resistance on the daily chart, rejecting the price and now we are seeing a bearish reversal lower. It’s still early to call for a trend shift after the last three days when we saw some really strong buying momentum, which pushed the price up to $78.80s, where buyers met the 50 SMA. Although, the stochastic indicator is not overbought yet, and the top of the range comes above $80, so there is still some more room for buyers, but the USD is gaining momentum today as sentiment deteriorates, so we decided to open a sell Oil signal at the 50 SMA.

US WTI Crude Oil Live Chart

WTI
Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
ABOUT THE AUTHOR See More
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.
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
0 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

HFM

Doo Prime

XM

Best Forex Brokers