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WTI Crude Oil Reversal to Push Prices Lower Next Week

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Important: This site uses New York Close Forex Charts so that each 24-hour session starts and ends at 5 pm EST. These charts are essential for trading price action.

In early April, WTI cleared rising wedge resistance near 61.60.

The market went on to carve two new swing highs above the 63.60 region.

However, like most upward breaks of ascending patterns, it didn’t last.

As of Friday’s close, the last three weeks of movement are nothing more than a false break.

Even the weekly time frame shows a bearish engulfing pattern.

WTI bearish engulfing pattern

In fact, this past week’s candle engulfed the previous two weeks.

Crude oil is also back below the 64.00 handle which served as key support for the market in June and August of last year.

Any retest of the area between 63.20 and 63.60 next week is likely to attract sellers.

With that in mind, I favor selling WTI for what could be a substantial move lower.

How low, exactly?

It’s difficult to say, but as long as oil is below 63.60 resistance on a daily closing basis, the 60.30 area is exposed followed by 58.20 and 55.40.

And if the market treats this as a rising wedge, it puts the objective at the pattern’s inception point or 42.45.

Buyers would need to secure a daily close back above the 64.50 area to negate the bearish outlook.

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WTI rising wedge on the daily time frame

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15 comments
Justin Bennett says

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Bannet says

Thnx Justin.why do upward breaks on ascending patterns don’t last??

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    Justin Bennett says

    You’re welcome. It’s because an ascending pattern signals exhaustion from buyers and demand dries up as prices move higher.

    Reply
      Pierre Mifsud says

      However if you draw a trendline on the daily time frame, with lows since the 24 th December 2018, it is still not broken as yet, so technically speaking the uptrend is still intact…..so the possibility of reaching 70.27 is still there!

      Reply
        Pierre Mifsud says

        Also the harmonic strength index in the weekly is still overbought so more gains may in future be possible..

        Reply
        Pierre Mifsud says

        I simply DO NOT see it as a false break, it is simply correcting before a move higher even towards the 72.50 handle.

        Reply
          Pierre Mifsud says

          I think it will correct till 61.66 where it will touch the trendline but not break it, then all the way up to 72.50

          Reply
          Prashant says

          agree. as far as 61.50 area holds .. rally is intact and looking for 70.

          Reply
          Prashant says

          brent wise as far as 70-70.50 holds .. looking for high 70s.

          Reply
Dilip says

Hi Justin , nice to know about WTI Crude . Just want to know whether breaks fall upto the inception point all the times or only sonetimes. What should be the profit target?

Reply
    Justin Bennett says

    There is no such thing as “all the time” in trading. It’s a game of probabilities, not guarantees.

    Reply
    Pierre Mifsud says

    Do not rush my friend

    Reply
Michael Motau says

Thanks Justin. This is great analysis!

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    Justin Bennett says

    You’re welcome. Glad you found it helpful.

    Reply
Attaelroy says

I need forex setup

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