Crude Oil Price Forecast: Approaching Key Support as Bearish Correction Looms

Welcome to Extreme Investor Network, where we provide you with unique insights and analysis to help you navigate the world of the stock market, trading, and Wall Street. Today, we are taking a closer look at the recent movements in the crude oil market, which is showing signs of potentially reaching a solid bottom.

Although the bearish retracement last week did not play out as expected, today’s decline is bringing crude oil closer to completing a pullback. It has been consolidating within a large symmetrical triangle pattern for over six months, and the bearish trend continuation this week is extending the timeframe for a potential breakout. As crude oil approaches the apex of the triangle pattern, the likelihood of a breakout increases. This upcoming retracement low could present an early entry point for a potential upside breakout.

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While a bearish breakdown is still a possibility, there is technical evidence pointing towards an eventual upside breakout. Investors will be monitoring the upcoming bottom closely, as it may offer the best risk versus reward entry for a potential bullish breakout. Additionally, some investors may find a rally to test higher price levels within the consolidation pattern appealing.

Looking at the monthly chart, there are strong indications that the correction in crude oil is likely to resolve to the upside. The chart shows support gathering around the 200-Month MA, with December 2022 seeing the line act as support. Last month almost perfectly retested the 200-Month line as support, with the low hitting 72.73 and the line at 73.12. Crude oil strengthened from that low, and the 50-Month MA gave a bullish signal by crossing above the 200-Month line. Furthermore, a bullish reversal was signaled this month as crude oil rallied above June’s high of 83.02.

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