Technical Overview: Oil WTI

Oil WTI 
Major upward move could be observed on the oil market yesterday with WTI finishing the day 2.1% higher. A move of this scale was a result of breaking a key resistance zone. In turn, a potential reversal pattern surfaced on the chart -a double bottom formation that often heralds an upward move. Oil market has been in a downtrend during the past two months.. However, following a  break of the $54.55 handle, bulls seems to be in favour.  A break below this support level would invalidate bullish set up.Source: xStation5

 

The oil market has been in a downward trend for two months. However, during the past three weeks, the price was consolidating in a wide range of $51-54.55. After breaking above the 54,55 handle, the movement accelerated. There are no sell signal on the chart, but correction could occur given recent rapid gains.

Source: xStation5

 

We are now observing the supply-side reaction to the local resistance. In case a bigger pullback occurs one should take into consideration the $56.10 handle where market geometry (1:1) can be found. This is the key short-term support for now and a break below it could trigger more selling.Source: xStation5

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