Potential Downside Risk in Crude Oil Crude oil futures have been limping for more than a year, and some traders could think they’re ready to falter.
The first pattern on today’s chart is the series of lower highs since June. The 50-day simple moving average (SMA) has also remained below the 200-day SMA. Those signals may be consistent with a longer-term downtrend.
Second, you have another series of lower highs since October 24. CL1! has stayed above the October 23 low of $59.64 in that time, resulting in a potentially bearish descending triangle.
Third, traders may eye the April 9 low of 55.12 if the triangle breaks.
Finally, stochastics recently hit an overbought condition and are now turning lower.
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