Technical Analysis – WTI crude futures trades around 2-week high; bullish bias but possibility of overstretched rally
March 20, 2018 10:26 am
WTI crude oil futures have reversed back up again after finding support at the 38.2% Fibonacci retracement level of 61.41 of the downleg from 66.60 to 58.15 and reached a two-week high of 62.82 today. Prices successfully broke above the 50.0% Fibonacci and are trading above their moving averages in the 4-hour chart.
The bullish picture in the short-term is supported by the MACD, however, the stochastic oscillator is signaling a possible bearish correction. The MACD oscillator is rising in the positive zone above its trigger line, while the stochastic oscillator is creating a bearish cross within its %K and %D lines in the overbought territory.
Should prices reverse lower, immediate support could some at 20-simple moving average (SMA) near 61.90 before it slips towards the 38.2% Fibonacci mark of 61.41. Further losses would open the way towards the 60.15 support level.
To the upside, there is a significant psychological resistance level at 63.00, which is acting as a major obstacle. A jump above this area could push the oil towards the 61.8% Fibonacci level of 63.40. A break above it would shift the short-term outlook to bullish as it would take the price to 64.20 taken from the high on February 26.
WTI crude oil futures have reversed back up again after finding support at the 38.2% Fibonacci retracement level of 61.41 of the downleg from 66.60 to 58.15 and reached a two-week high of 62.82 today. Prices successfully broke above the 50.0% Fibonacci and are trading above their moving averages in the 4-hour chart.
The bullish picture in the short-term is supported by the MACD, however, the stochastic oscillator is signaling a possible bearish correction. The MACD oscillator is rising in the positive zone above its trigger line, while the stochastic oscillator is creating a bearish cross within its %K and %D lines in the overbought territory.
Should prices reverse lower, immediate support could some at 20-simple moving average (SMA) near 61.90 before it slips towards the 38.2% Fibonacci mark of 61.41. Further losses would open the way towards the 60.15 support level.
To the upside, there is a significant psychological resistance level at 63.00, which is acting as a major obstacle. A jump above this area could push the oil towards the 61.8% Fibonacci level of 63.40. A break above it would shift the short-term outlook to bullish as it would take the price to 64.20 taken from the high on February 26.
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