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Chart Art: WTI Crude Oil Downtrend Resistance Ahead?

November 21, 2023| Forex Market

Oil is bouncing once again in the longer-term downtrend. Will this attract longer-term sellers once again or is it finally time for the bulls to take charge?

WTI Crude Oil (USOil): 4-Hour

WTI Crude Oil CFD: 4-Hour Chart by TradingView

WTI Crude Oil CFD: 4-Hour Chart by TradingView

Directional biases and volatility conditions in trading are typically driven by fundamentals. If you lack a fundamental-based price outlook for oil, it’s time to do some digging by checking out the forex calendar and stay updated on daily fundamental news!

After you’ve done your homework and you think oil bears are going to stay in control, then check out these textbook short arguments on WTI Crude oil.

On the 4-hour chart above, we can see prices are in a clear down trend, going back to the end of September when oil reached $95.00 a barrel. Who remembers how much fun that was when filling up the gas tank?!

But a the moment, oil is finding a bid after making a bottom around the $72.50 handle, and it looks like the bulls are likely to get the market back up to what looks like a confluence of several technical arguments.

The $80.00 – $82.00 area is where falling simple moving averages, a falling ‘highs’ trendline, and a broken support-turned-potential-resistance meet. We can also see the Stochastic indicator signaling potentially overbought conditions in the short-term.

Technical traders may be placing there orders there to play there biases, and if we see bearish reversal patterns there, then the downtrend has a pretty good chance of staying alive.

For you oil bulls out there, that same area is the one to watch for a potential long play. If the market can sustain a break above all of the likely short orders waiting there, odds are that more bulls may show, again depending on the fundamental drivers at that time.

So, that’s the area to watch out for bias confirmation before considering a long or short risk management strategy, but what are your thoughts on oil this week? Are you leaning bullish or bearish and why?

We love to hear everyone’s ideas so feel free to drop a comment below and share your thoughts!

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