On Friday 19th November USOIL hit the SMA(20) in the 8h chart and the sellers took control of the market. As a result, the market dropped over five per cent after the rally failed. We said (in a previous analysis here blog.tiomarkets.com/...ate-hike-in-q3-2022/) that if the 77.58 low is violated decisively, the next important support level is at 74.73. This level was hit in todays trading.
USOIL failed to attract follow-through buying on Friday and the market sold off reaching a seven-week low after Japan said it might release some of its oil reserves. The COVID-19 restrictions in in Europe raised concerns about weakening demand. By reading further you agree with our disclaimer below and acknowledge that we do not provide investment advice.
Technically the price is however oversold and we might see a short term rally before the price moves to resistance levels again.
USOIL moved to 74.73 level (coincides with the 38.2% retracement level) and bounced higher as we expected earlier. Now the key resistance area is the 75.89 – 79.18 range. If oil fails to penetrate this key resistance area it is likely to the test the 74.73 low again. If the 74.05 – 74.73 range is violated decisively the next key price level to focus on is the 69.35 - 71.10 range where we have a reactionary low from September and the 50% Fibonacci retracement level. Bearish factors in this market include the Covid fears and risk of more oil reserves being released but also the Natural gas market topping takes away another incentive to buy oil. This could mean that the future rallies are also sold. However, as usual let's trade only what we see and look for price action confirmation for our views before taking action.
Trade Safe!
Janne Muta
TIOmarkets.com
Chief Market Analyst
DISCLAIMER TIOmarkets offers exclusively consultancy-free service. The views expressed in this blog are our opinions only and made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his/her investment decisions. The analyzes and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with any legal requirements for financial analyzes and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval. FX and CFDs are leveraged products. They are not suitable for every investor, as they carry a high risk of losing your capital. Please ensure you fully understand the risks involved. All the prices in this report are CFD prices based on price charts provided by TIOmarkets unless otherwise stated.
USOIL failed to attract follow-through buying on Friday and the market sold off reaching a seven-week low after Japan said it might release some of its oil reserves. The COVID-19 restrictions in in Europe raised concerns about weakening demand. By reading further you agree with our disclaimer below and acknowledge that we do not provide investment advice.
Technically the price is however oversold and we might see a short term rally before the price moves to resistance levels again.
USOIL moved to 74.73 level (coincides with the 38.2% retracement level) and bounced higher as we expected earlier. Now the key resistance area is the 75.89 – 79.18 range. If oil fails to penetrate this key resistance area it is likely to the test the 74.73 low again. If the 74.05 – 74.73 range is violated decisively the next key price level to focus on is the 69.35 - 71.10 range where we have a reactionary low from September and the 50% Fibonacci retracement level. Bearish factors in this market include the Covid fears and risk of more oil reserves being released but also the Natural gas market topping takes away another incentive to buy oil. This could mean that the future rallies are also sold. However, as usual let's trade only what we see and look for price action confirmation for our views before taking action.
Trade Safe!
Janne Muta
TIOmarkets.com
Chief Market Analyst
DISCLAIMER TIOmarkets offers exclusively consultancy-free service. The views expressed in this blog are our opinions only and made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his/her investment decisions. The analyzes and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with any legal requirements for financial analyzes and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval. FX and CFDs are leveraged products. They are not suitable for every investor, as they carry a high risk of losing your capital. Please ensure you fully understand the risks involved. All the prices in this report are CFD prices based on price charts provided by TIOmarkets unless otherwise stated.