Although WTI oil was moving lower from the start of this week, it failed to drop below the lower side of a rising channel pattern that has been in play since the beginning of October. Despite this week’s decline, the commodity has rebounded from the lower side of the upside channel. As long as it continues to respects that lower bound, the commodity has got a chance to move further up. This is why for now we will remain somewhat bullish.
A strong push higher and break above yesterday’s high, at 55.63, could attract more buyers into the game and the price may rise to the highest point of this week, at 56.95. The “black gold” might get a hold-up around there, or even correct slightly lower. That said, if WTI oil stays above the previously-mentioned 55.63 hurdle, this could attract the bulls back into the field and the commodity could travel back to the 56.95 zone. If this time that area fails to withstand the bull-pressure, its break might lead WTI oil to the 57.76 level, marked by the low of September 18th. Around there, the black liquid may test the upper bound of the aforementioned upside channel.
Looking at our oscillators, the RSI and the MACD, both are somewhat in support of the above-discussed scenario. The RSI, although slightly below 50, had bottomed recently and is now pointing to the upside. The MACD, even though still below zero, started pointing slightly higher.
Alternatively, if the lower side of the aforementioned upside channel breaks and the price falls below the 53.76 hurdle, which is yesterday’s low, this may lead to further declines, as more sellers could be joining in. WTI oil might then drift towards the 52.50 obstacle, a break of which could send the commodity to the 51.55 obstacle, or even to the 51.17 level, marked by the lows of October 9th and 3rd respectively.
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