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
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