The WTI price has been rising since early November when it tested the low at 33.60. In just 2 months, the price has grown by 48.86% as the recent high has been produced at 49.28. While the price has been printing higher highs, the CCI oscillator has been printing lower lows, thus forming a bearish divergence on the 4-hour timeframe straight after the price went down sharply and broke below the 20 Exponential Moving Average as well as the support uptrend trendline.
On the pullback, the 61.8% Fibonacci resistance at 48.10 got rejected, which now might act as a strong resistance area. Besides, right at the moment of resistance being rejected, the new Fibonacci cycle has started. Perhaps it can be a strong bearish cycle that might last weeks or even months.
While the USOil could be getting ready to correct down or even to reverse the trend, for such a scenario, the price must remain below the recently printed high at 49.28. As long as this is the case, WTI should be expected to move down, potentially aiming for the 42.40 support level. This support is confirmed by two Fibs, 88.6% retracement of the Fibs applied to the August - November downside correction, and the 78.6% Fibs applied to the November 11-13 downside correction.
To summarise, the price of the USOIL is likely to slowly start reversing down, but only as long as the current high is being respected. If there will be a break and close above the 49.28 resistance, the bearish forecast will be invalidated and the long-term uptrend will most probably continue.
Key support levels: 46.12, 43.86, 42.40
Key resistance levels: 48.12, 49.00, 49.28
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
On the pullback, the 61.8% Fibonacci resistance at 48.10 got rejected, which now might act as a strong resistance area. Besides, right at the moment of resistance being rejected, the new Fibonacci cycle has started. Perhaps it can be a strong bearish cycle that might last weeks or even months.
While the USOil could be getting ready to correct down or even to reverse the trend, for such a scenario, the price must remain below the recently printed high at 49.28. As long as this is the case, WTI should be expected to move down, potentially aiming for the 42.40 support level. This support is confirmed by two Fibs, 88.6% retracement of the Fibs applied to the August - November downside correction, and the 78.6% Fibs applied to the November 11-13 downside correction.
To summarise, the price of the USOIL is likely to slowly start reversing down, but only as long as the current high is being respected. If there will be a break and close above the 49.28 resistance, the bearish forecast will be invalidated and the long-term uptrend will most probably continue.
Key support levels: 46.12, 43.86, 42.40
Key resistance levels: 48.12, 49.00, 49.28
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.