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Tuesday, May 28, 2013

WTI and Brent Crude Oil charts: an update

WTI Crude chart

WTI Crude_May2713

The 6 months daily bar chart pattern of WTI Crude oil shows another aborted attempt by the bulls to push oil’s price past the resistance level of 98. Bears used the rally to sell. Down-day volumes continue to remain strong, which is a bearish sign.

Daily technical indicators are turning bearish. MACD is still positive, but is falling below its signal line. RSI has slipped below its 50% level. Slow stochastic has fallen sharply below its 50% level. Note that MACD and Slow stochastic touched lower tops while oil’s price touched a slightly higher top.

The negative divergences could lead to a drop below the 200 day EMA. For the past 6 months, oil’s price has been consolidating in a broad range between 86 and 98. Since the 200 day EMA is rising, the scales are slightly tilted towards the bulls for now. 

Brent Crude chart

BrentCrude_May2713

The 6 months daily bar chart pattern of Brent Crude oil is clearly in a bear market. Another attempted rally faced strong resistance from the falling 50 day EMA, and dropped below the 20 day EMA on rising volumes.

Daily technical indicators are looking bearish. MACD has dropped down to touch its signal line in negative territory.Both RSI and Slow stochastic have slipped below their 50% levels. Slow stochastic has formed a head-and-shoulders reversal pattern.

Some more consolidation/correction is likely.

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