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Anyone looking for a pullback on crude oil, too?
Price has formed higher lows and slightly higher highs inside a rising wedge seen on its 4-hour time frame.
Check out these support zones I’m seeing on the commodity’s chart formation!
WTI Crude Oil (USOIL) 4-hour Chart by TradingView
Crude oil seems to be in pullback mode after hitting the top of its wedge formation, finding some buyers at the 38.2% Fibonacci retracement level.
Bulls have been keeping the uptrend intact for the past couple of months, thanks to the OPEC+ output deal extension and positive expectations for oil demand. Geopolitical tensions in Russia flaring early this week appear to be propping the commodity higher once more.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on WTI crude oil, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
A return in bullish pressure at current levels might be enough to put the commodity back on track towards testing the highs at $83.16 per barrel near R1.
After all, Stochastic is already reflecting a pickup in bullish momentum since the oscillator is pulling up after reaching the oversold region. At the same time, the 100 SMA is above the 200 SMA to confirm that the climb is more likely to gain traction than to reverse.
Still, a larger correction could spur a dip to the 50% Fib closer to the $80 per barrel major psychological mark, which might be a more attractive entry point for oil bulls.
Note that the 100 SMA dynamic support lines up with the 50% Fib to add to its strength as a floor while the 200 SMA dynamic inflection point is closer to the bottom of the wedge. A break below this area, though, could signal a wedge breakdown and mark the start of a reversal.
In particular, look out for a move below S2 ($78.63 per barrel) as this could usher in a downtrend that’s the same height as the chart pattern.
Good luck and good trading this one!
