On the daily chart, it looks as if WTI crude oil could go either way currently. It also looks as if the catalyst for the next move will be the OPEC+ ministerial meeting which was postponed to this Thursday from Sunday.
But a quick peek at the 4-hour chart (see above) shows definite positive divergence between price and the MACD. Prices have been trending lower since the highs hit at the end of September. Yet the 4-hour MACD has been trending up over the same period, putting in a succession of higher lows. It is often the case that such situations resolve in a bullish fashion.
But while front-month WTI has found recent support around $73, the daily chart also shows that more significant support comes in a band between $67.50 and $70.50. Could we see prices spike down and test this support? Possibly, particularly if OPEC+ were to surprise markets by, say, ending the current output cuts. While that particular scenario does seem unlikely, there are plenty of twists and turns that could take place this week. Traders should expect conditions to remain volatile until Thursday’s OPEC+ announcement gets priced in.
But a quick peek at the 4-hour chart (see above) shows definite positive divergence between price and the MACD. Prices have been trending lower since the highs hit at the end of September. Yet the 4-hour MACD has been trending up over the same period, putting in a succession of higher lows. It is often the case that such situations resolve in a bullish fashion.
But while front-month WTI has found recent support around $73, the daily chart also shows that more significant support comes in a band between $67.50 and $70.50. Could we see prices spike down and test this support? Possibly, particularly if OPEC+ were to surprise markets by, say, ending the current output cuts. While that particular scenario does seem unlikely, there are plenty of twists and turns that could take place this week. Traders should expect conditions to remain volatile until Thursday’s OPEC+ announcement gets priced in.