WTI Crude chart
The 6 months daily bar chart pattern of WTI Crude oil – which was consolidating sideways for the past 2 months - broke out upwards and touched an intra-day high above the 112 mark accompanied by a volume spurt. But the bears refused to surrender without a fight, and pushed oil’s price down to its rising 50 day EMA that has provided good support during recent down moves.
Oil’s price is continuing its up move. All three EMAs are rising and oil’s price is trading above them, which is the sign of a bull market in progress. But sliding trading volumes is not conducive for a sustained rally.
Daily technical indicators are in bullish zones. However, all three indicators are showing negative divergences by failing to touch new highs.
The possibility of an attack on Syria by the USA, which had led to the recent spurt in oil’s price, seems to be diminishing. Some profit taking may emerge.
Brent Crude chart
The 6 months daily bar chart pattern of Brent Crude oil spiked upwards on strong volumes on the possibility of a US air-attack on Syria. Oil’s price started forming a flag-like pattern from which it has broken downwards into the resistance zone between 112.50 and 115, after US Congress vetoed the President’s proposal.
All three EMAs are rising and oil’s price is trading above them, which is the sign of a bull market. But strong volumes on down days shows that bears continue to be active.
All three daily technical indicators are correcting from overbought conditions, but remain in bullish zones. MACD is about to cross below its signal line. RSI is falling towards its 50% level. Slow stochastic is showing negative divergence by failing to touch a new high. It has also formed a bearish head-and-shoulders pattern with the left ‘shoulder’ and ‘head’ inside its overbought zone.
Oil’s price may drop towards its rising 50 day EMA.
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