Oil price declined with a bearish gap during the Asian session today. Can Oil strike higher after the bearish gap below $27.50 area? What are the charts and technical indicators are saying? Read more to find further insights into today’s Oil Technical Analysis.
April 6, 2020 | AtoZ Markets – Oil is currently residing near $27.30 area and quite impulsively pushing the price higher. After a bearish gap took place, WTI recovered almost 50 per cent and may sustain further.
Oil price dropped today as OPEC+ delayed a recent meeting schedule. The meeting’s objective was to end the ongoing Oil price war between Saudi Arabia and Russia. Moreover, After a delayed meeting schedule, it increased investors fear while they think these latest talk will also end in future like its last meeting in March. Besides, Kurt Hallead, RBC co-head of global energy research said on CNBC, “The energy sector is facing its most challenging fundamental period since the Great Energy Depression of 1981-1995.”
He also added, “On the oil front, demand set to decline by amounts never before seen driven by the COVID-19 global economic shock while supply is surging due to the Saudi-Russia oil price war.” On the other hand, International Brent Oil Oil Futures fell 6% to $32.74, and U.S. Crude Oil WTI Futures also dropped 6.1% to $26.61 on the Asian session Monday.
Oil Strike Higher -Can Break Above $27.50 Area?
WTI is currently trading around $27.30 area and trying to strike higher. The current price action is quite impulsive and non-volatile, which may sustain further and break above $27.50 area in the days ahead.
Image: Oil 4 Hour Chart
According to the 4-hour chart, the price of Oil became impulsive after bounce from the $25.10 area. Currently, the price trading around $27.30 area and trying to break above $27.50, which is a strong event level. As per the current scenario, if the price breaks above $27.50 area with a 4-hour close, the bulls may take the price higher towards $36 area in the coming days. Alternatively, a break below $25.10 area may lead the price lower towards $20 again.
Furthermore, the dynamics level of 20 EMA is residing below the current price, along with the Kijun line and Tenkan line, which may now become potential support for the price. The dynamic levels also broke above the Kumo Cloud recently, which is a good sign for further upward pressure. Besides, the MACD lines are residing above 0.00 level and may sustain further if the bulls continue the trend.
WTI Bulls May Hold the Current Momentum
According to the Daily chart, WTI is currently residing near $27.30 area after Oil strike higher from $25.10. As per the current price action context, if the price breaks above $27.50 area with an impulsive daily close, the bulls may continue to climb higher towards $42 area in the long run. On the other hand, as long as the price remains below $27.50 area, the bears may pressurize further.
Image: Oil Daily Chart
Moreover, the dynamic level of 20 EMA is residing near the current price area, which may act as a strong resistance. So, if the price can break above the dynamic level, the bullish pressure may sustain further. Besides, the MACD lines are residing far below from the 0.00 level and recently had a bullish cross over, which adds to the upcoming bullish confluence.
To conclude, Oil is quite impulsive and non-volatile with the current bullish momentum. Oil Bulls may sustain the momentum further if the price could have a daily close above $27.50 area again in the days ahead.