The rise in Oil prices cannot overcome support level despite weak dollar
2023.02.02 08:08
The rise in Oil prices cannot overcome support level despite weak dollar
Since June, WTI oil futures (March delivery) have been in a long-term downtrend, reaching a new one-year low of 70.30 in December. The commodity’s price has fallen below its 50-day simple moving average (SMA) to begin a new downtrend in the near term.
At the moment, the momentum indicators suggest that selling pressures are getting stronger. In particular, the RSI is flatlining below its 50-neutral mark, while the MACD histogram has fallen below its red signal but remains above zero.
To the downside, if the price continues to fall, the most recent low of 76.20 could serve as immediate support. The commodity could challenge the low of 72.70 in 2023 if it penetrates that region. The one-year low of 70.30 may be made possible by a break below that region.
On the other hand, if buyers regain control and raise the price above the 50-day SMA, the most recent resistance area of 82.65 might prevent a quick rebound. Before the 97.65 hurdle appears on the radar, the bulls could aim for the November high of 92.50 if they conquer this barricade. The price advance may even come to an end at 102.00, which served as support and resistance in June.
To put it succinctly, the price of WTI oil futures fell below the crucial 50-day SMA, indicating that the technical picture is getting worse. The commodity needs to reclaim the aforementioned technical level in order for that bearish sentiment to turn around.
