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Tuesday, June 13, 2017

WTI and Brent Crude Oil charts: bears clearly on top

WTI Crude Oil chart


The following remarks appeared in the previous post on the daily bar chart pattern of WTI Crude Oil: "Since the beginning of the year, oil's price has formed a bearish pattern of 'lower tops, lower bottoms'. Till that pattern gets reversed, expect bears to sell on every rise."

Bears took charge and pushed oil's price down to 45. Bulls may feel relieved that the May low of 43.75 was not breached. Bears will point out that the 50 day EMA has crossed below the 200 day EMA - the 'death cross' that technically confirms a return to a bear market.

Daily technical indicators are looking oversold and triggered a technical bounce on Monday (Jun 12). The bounce was aided by inventory declines in US and news that Saudi Arabia will limit supplies to some Asian buyers and deepen supply cuts to USA.

Strong volumes on recent down days show that bears are in no mood to relinquish control.

On longer term weekly chart (not shown), oil's price closed below its three weekly EMAs in a long-term bear market. Weekly technical indicators are in bearish zones and showing downward momentum.

Brent Crude Oil chart


The daily bar chart pattern of Brent Crude Oil shows bears are very much on top. Oil's price dropped to 47.50 before bouncing up a bit. 

The imminent 'death cross' of the 50 day EMA below the 200 day EMA will technically confirm a return to a bear market.

A fall below the May '17 low of 46.50 will keep the bearish pattern of 'lower tops, lower bottoms' intact.

Oversold technical indicators may encourage bulls to turn Monday's (Jun 12) technical bounce into a pullback rally. Note that Slow stochastic is showing negative divergence by falling lower.

Expect bears to keep selling on every rise.

On longer term weekly chart (not shown), oil's price closed below its three weekly EMAs in a long-term bear market. Strong volumes on recent down weeks may lead to a re-test of the Jan '16 low. Weekly technical indicators are looking bearish.

2 comments:

Subhankar said...

Two opposing views on where oil price is headed:

http://www.investopedia.com/news/why-oil-prices-could-double-90-rig-hes/

http://www.investopedia.com/news/why-oil-may-plunge-30-barrel/

Subhankar said...

Oil slides, hits six-month low on rising global production

http://in.reuters.com/article/us-global-oil-idINKBN196031