Oil price has become corrective and indecisive after OPEC and its allies delayed the meeting. Oil Bulls Failed to Break Above $27.50 -What Is Next? What are the charts and technical indicators are saying? Read more to find further insights into today’s Oil Technical Analysis.
April 7, 2020 | AtoZ Markets – Oil is currently trading around $26.70 area and quite volatile. The price tried to break above $27.50 area after fill up the recent bearish gap, but failed to survive and pushed down. As per the current price action, bulls are trying to push the price higher may find support at the dynamic level on the intraday chart.
Crude Oil price dropped nearly 6% on the last trading day as Russia, and Saudi Arabia were still arguing. They are debating about who between them caused the market downfall rather than agreed on a production cut. Moreover, Kirill Dmitriev, CEO of the Russian Direct Investment Fund told in an interview with CNBC, “I think the whole market understands that this deal is important and it will bring lots of stability, so much important stability to the market, and we are very close.”
On the other hand, West Texas Intermediate down to $2.26, or 8%, at $26.08 per barrel, and Internation Brent Oil down to $1.06, or 3.1%, at $33.05 per barrel.
Oil Bulls Failed to Break $27.50 as Bears Still Present in the Market
WTI is currently residing near $26.70 area and trying to recover higher. The current price action is quite volatile and corrective may sustain further between the range of $27.50-$25 area.
Image: Oil 4 Hour Chart
According to the 4-hour chart, Oil is currently residing near $26.70 area and trying to push higher. WTI is successfully able to hold the price above $25 area, which is a very important support level. As per current price action, if the price can break above $27.50 area with an impulsive 4-hour close, the bulls may take the price higher towards $36 in the days ahead. Alternatively, if the price breaks below $25 area with an impulsive intraday close, the bears may decline towards $20 area.
Furthermore, the dynamic level of 20 EMA is residing below the current price, along with the Kijun line. The dynamic levels are broke above the Kumo cloud, which is a good sign of further bullish momentum. So, the dynamic level may now work as a strong support to push the price higher in the coming days. Besides, the MACD lines are gradually pushing upward, which may add some confluence to the upcoming bullish pressure.
WTI May Face Resistance at the Dynamic Level
According to the Daily chart, the price is quite volatile while residing below $27.50 area. Oil tried several times to break above $27.50 area but failed to sustain and decline. As per the current scenario, if the price breaks above $27.50 area with an impulsive daily close, the bullish pressure may sustain further towards $36 are in the coming days. In contrast, a break below $25 area may lead the price down towards $20 area again.
Image: Oil Daily Chart
Moreover, the dynamic level of 20 EMA is currently residing above the price, which act as a strong resistance before. So, if the price can break above the dynamic, the bulls may recover higher towards our expected target area. Besides, the MACD lines are residing below 0.00 level and had a bullish intersection, which is a good sign of further bullish momentum.
To conclude, Oil has been quite volatile and indecisive because of the ongoing price war between Russia and Saudi Arabia. As per the current scenario, if the price can break above $27.50 area, the oil may recover higher in the process. It should be noted, as long as the price residing below $27.50 area, the bias will remain bearish.