Crude oil prices may continue higher towards $50.50 area soon. The price bounced higher after rejecting the $45 area with a strong Bullish close. Let’s check the crude oil technical analysis for more levels and insights.
March 3, 2020 | AtoZ Markets – The price of Oil continues moving higher after breaking above the $43.50 resistance area. Oil Bullish run may continue further higher towards the $50.50 resistance area in the coming sessions. But a certain retracement is needed before Oil Bullish run continues its momentum.
Crude Oil Prices Fundamental Highlights
Oil price rose for the second day on the hope that OPEC will cut the output deeper on the impacts of the Coronavirus outbreak. The price recovered in the last two days after a significant drop of 20% from January peak, 2020. At the meeting coming up on March 5-6 in Vienna, the Organization of the Petroleum Exporting Countries (OPEC) and Russia, which known as OPEC+, are expected to make a declaration on deeper output cuts.
On the other hand, Ed Moya, Analyst at New York trading platform OANDA, said, “Rate cuts will not cure the economic impact of the Coronavirus, only an antidote will do that.” Moreover, Coronavirus spreads 58 countries and affected more than 89,000 people around the world. Six people have died from Coronavirus in the U.S. State of Washington, according to health officials.
Oil Bullish Trend May Continue Further After Retracement
The price of oil broke above the $47.50 area after bouncing from the $43.50 support level. While the bullish trend may continue further, a certain retracement is needed. If the price is able to retrace lower towards $46.50 area, the uptrend may continue with the target of $50.50.
Image: Oil 4 Hour Chart
According to the 4-hour chart, the price is currently trading near $48 area and may continue higher. After rejecting the $43.50 support area, the price was able to spike above $45 area impulsively. If the price retraces towards the $46.50 area, the upward momentum may sustain further. The dynamic level of 20 EMA is residing below the current price, along with the Kijun line and the Tenkan line. It may pull the price down towards $46.50 area as Mean Reversion.
Moreover, the MACD lines are residing below 0.00 level and gradually moving upwards. And the MACD histogram volumes are residing above 0.00 level, which is a good indication that Bulls may take the price higher in the coming events.
Oil Bearish Trend May Continue After Retracing Higher Towards $50.50 Area
According to the Daily chart, Oil was rejected $43.50 key support and close above $45 with a daily engulfing bar. The price of Oil is now residing near $47.80 and may continue to push higher towards $50.50 resistance area as a retracement. The dynamic level of 20 EMA is also residing near $50.50, which may pull the price as Mean Reversion. The Kijun line and the Tenkan line are residing above the current price, which may also work as a confluence of 20 EMA.
Image: Oil Daily Chart
Moreover, the MACD lines are creating a Bullish divergence, which may support the price to retrace higher. And the MACD histogram volumes are also moving upward but residing below 0.00 line. It may turn as green if the price gradually moves higher.
To conclude, Oil is trading near $47.80 area and may continue higher with the target of $50.50. Oil Bearish trend may proceed further with the target of $45 again after a certain retracement.