Oil Surge Higher on the Indication of Recovery in Demand


Oil has become volatile but still maintain the price above $40 support area. Oil surge higher on the indication of recovery in demand. Will WTI recover further? What are the charts and technical indicators are saying? Read more to find further insights into today’s WTI Technical Analysis.

August 11, 2020, | AtoZ Markets – Oil is currently trading around $42.40 area and trying to climb higher. The price found support on the dynamic level of 20 EMA and pushed upside, according to the intraday chart. As per the current price action, WTI may face strong resistance around $42.50 area in the coming days.

Oil price rose today during the Asian session on signs that the demand for oil might be recuperating alongside reestablished hope for another stimulus package in the U.S.

Moreover, ANZ said in a note, “Crude oil rose in signs of further stimulus measures. The U.S. lawmakers continued negotiations on the huge virus relief economic package with Treasury Secretary Steven Mnuchin saying there are areas where compromise is possible and a fair deal could be agreed upon. The sentiment also boosted by comments from Saudi Aramco that demand is improving.”

Oil Surge Higher as the World’s Economy Is Recovering From COVID-19

WTI is currently residing near $42.40 area and trying to push upside. Furthermore, the price also broke above the Kijun line and the Tenkan line on the intraday chart.

Oil Strike Higher

Image: Oil 4 Hour Chart

According to the 4-hour chart, Oil surge higher and currently trading around $42.40 area. As per the current price action, if the price can break above $42.50 area with an impulsive bullish candle close, the bulls may recover higher towards $45 area in the days ahead. Alternatively, if the price rejects $42.50 area with an impulsive bearish candle close, the bears may regain momentum and push the price downside towards $40 area in the coming days.

In addition, the dynamic level of 20 EMA is currently residing below the price. Along with the Kijun line and the Tenkan line. The dynamic level may act as strong support to push the price higher. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level. In contrary, the bears may regain momentum if the price can break below the dynamic level in the coming days.

WTI Bulls Are Optimistic

According to the daily chart, Oil surge higher and currently residing near $42.40 area. As per the current price action context, if the price can break above $42.50 area with an impulsive daily bullish candle, the bulls may sustain the bullish pressure further towards $48 area in the coming days. In contrast, if the price rejects $42.50 area with a daily bearish candle, the bears may regain momentum and decline towards $40 area in the days ahead.

Oil Surge Higher

Image: Oil Daily Chart

Along with, the dynamic level of 20 EMA is currently residing below the price. It may pull the price down as a mean reversion. Also, the MACD lines are currently residing above the 0.00 level and may have a bullish intersection. It indicates that bulls may continue the bullish pressure further.

To conclude, after gaining a huge amount of pips Oil facing strong resistance around $42.50 psychological area. A daily impulsive close is required to find the definite momentum in the coming days. 

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