The 200 SMA to Decide Where Crude Oil Heads This Week
Crude oil has been sliding for a few months, with highs decreasing and moving averages acting as resistance. The decline continued and WTI crude fell below $68. However, buyers have returned, and we have been seeing considerable buying pressure in the last two weeks, pushing the price above $76 yesterday.
However, the global economy is still slowing. But, there have been some positive numbers recently, and we have seen some demand return, adding here the rising geopolitical tensions in the Red Sea. On the back of Middle East concerns, a barrel of WTI Oil finally broke above the $74-75 resistance zone, peaking just above $76/barrel yesterday.
WTI Oil H4 Chart – Will the 200 SMA Hold As Support
Considering the magnitude of challenges in the region, the optimistic market reaction appears to be relatively weak. However, traders are cautious so the rally will most likely continue but continue at a slow pace. WTI crude has pushed above all moving averages on the H4 chart, as shown above, which turned into support eventually.
The 200 SMA (purple) was stopping the climb higher last week, acting as resistance, while the 100 SMA (green) was acting as support. But the 200 SMA was broken after the spike higher yesterday, due to the thin liquidity conditions in financial markets as well. Today we are seeing a retreat lower, but the 200 is now acting as support, however, let’s see if it will hold.
If it does, then the next natural goal for WTI Oil bulls is the 200 moving average on the daily chart, which comes at $78, with the price likely to face decent resistance at this area. According to energy experts, there isn’t much OPEC+ can do to raise prices beyond this point. This is because the United States has been producing massive amounts of crude Oil, setting new records for production and crude Oil exports. “OPEC+ just can’t cut enough to sustain a price much above where we are right now,” Once Upon a Time Capital’s John Kilduff said yesterday. We decided to open a buy Oil signal yesterday at the 200 SMA, hoping for a bounce off this moving average.
US WTI Crude Oil Live Chart
ABOUT THE AUTHOR
See More
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals