Crude oil price continues the bearish trend and may reach $50 per barrel in the upcoming days. The price recently closed below $51.50, indicating that the bearish pressure may continue. Let’s check the Oil Technical Analysis for more levels and insights.
February 25, 2020, | AtoZMarkets – Oil is now retracing near $51.50 resistance area may continue its Bullish bias. Oil continues it’s Bearish trend which may reach towards $50 event-level as a retracement. The dynamic levels are also residing near the price, which may also work as confluence.
Oil rose on Tuesday after the Crude Oil benchmark dropped almost 4% in the previous session. The fears of spreading Coronavirus could fall far greater economic damage than initially thought capped gains. Yoshida said, “Fears that the rapidly-spreading Coronavirus outside of China could lead to a bigger than anticipated impact on the global economy, and Oil demand will likely keep weighing on market sentiment.”
Moreover, The Coronavirus outbreak can still be beaten. The World Health Organization said,” insisting it was premature to declare it a pandemic even though it had the potential to reach that level.” On the other hand, investors are showing interest in the safe-haven markets like Gold and the U.S Dollar, after Coronavirus infections spread in Italy, South Korea, and Iran.
Oil Continues Bearish Trend may push lower After Retracement
Oil recently retraced near $51.50 area after the market open today. The Oil Bearish trend may sustain after the retracement, with the target towards $50 area. After rejecting $54.35 area, Oil pushed lower impulsively and making new lower lows indicating a further downward move in the process.
image: Oil 1 Hour Chart
According to the 1-hour chart, the Oil is currently residing near $51.50 resistance area, after a Monday strong close. Oil may push lower towards $50 after a retracement. The dynamic level of 20 EMA is residing near the price, which may work as strong resistance to push the price down. The Kijun line and the Tenkan line also may function as Bearish confluence with 20 EMA.
On the other hand, the Macd lines are currently residing below the 0.00 level. This is a good sign for Bears which may take the price lower, and the MACD histogram volumes are also slopping down as confluence.
Oil Near the Weekly Support Zone
According to the daily chart, the price is currently residing near the weekly support zone $50.50 area. After reaching $49.50 area price became so corrective and non-volatile. Bulls tried to push the price higher but failed to sustain and rejected from the $54.35 resistance area. If price able to break above $54.35 area with a strong Bullish close, the long term Bullish trend may establish.
image: Oil Daily Chart
Moreover, the dynamic level of 20 EMA is quite indecisive, along with the Tenkan line and the Kijun line because of high volatility. The MACD lines are slopping higher but residing below 0.00 level, which does not indicate anything.
To conclude, Oil is now quite volatile. If the price break above $54,35 resistance area, the price may push higher towards $57. On the contrary, if the price break below $50, the price may push lower towards $47.