It looks like WTI crude oil traders just can’t make up their minds!
The energy commodity is still hanging out at its area of interest visible on the 4-hour time frame, as several inflection points span the region.
Will the longer-term trend persist?
WTI Crude Oil (USOIL): 4-hour
WTI Crude Oil (USOIL) 4-hour Forex Chart by TradingView
Worsening geopolitical tensions in the previous week lifted crude oil prices back up to the former support zone around the $72 per barrel mark, which held as resistance this time.
After all, the spotlight seems to have shifted away from the Middle East conflict and back to global demand concerns, as major economies printed downbeat flash PMI readings a few days back.
These dragged crude oil back down to the bottom of its short-term ascending channel around $60.75 per barrel, which still seems to be holding as a floor so far.
Will we see a break lower and further downside momentum?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on crude oil and the U.S. dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!The 100 SMA is below the 200 SMA, hinting that the path of least resistance is to the downside. Keep an eye out for a move below the channel support, as this could drag the energy commodity price down to the next bearish targets at S2 ($67.45 per barrel) and S3 ($66.36 per barrel) or all the way down to the swing low that lines up with S4 ($65.27 per barrel).
On the other hand, a bounce off the near-term support could be followed by a move back to the channel top near R1 ($72.28 per barrel). Sustained bullish pressure could even spur another attempt to break above the area of interest, potentially lifting crude oil to the next upside barriers at R2 ($73.37 per barrel) then R3 ($75.24 per barrel).
Don’t forget to practice proper risk management and stay aware of top-tier market catalysts when trading this one. Good luck!