Technical Analysis – Will WTI oil futures continue higher?
- WTI oil futures bounce up but not meaningfully
- Technical risks favor the bulls; resistance at 73.00-74.00
WTI oil futures jumped back to the 70 territory after Iran fired around 200 ballistic missiles towards Tel Aviv and Jerusalem on Tuesday, reminding investors that the tensions in the Middle East could escalate further before the situation improves.
Despite the bullish correction, the price could not overcome the support-turned-into-resistance zone of 71.95 and the descending trendline from July at 73.00. That said, the bulls may not give up the battle immediately. With the RSI climbing above its 50 neutral mark and the stochastic oscillator starting a new positive cycle, more increases are likely in the short term.
Should the price reclaim the 50% Fibonacci retracement of the latest downleg at 74.00, it could advance towards the 61.8% Fibonacci mark of 76.43 and the 200-day simple moving average (SMA). A step higher might clear the way towards the long-term resistance trendline September 2023 at 79.67.
If sellers keep the price below 71.95, support could initially come around the 20-day SMA at 69.00 and then near the 67.00 round level. A move lower could halt near the tentative support trendline at 64.12 and the base of the broad range. If the bears breach that floor, all the eyes will turn to the 2021 bar of 61.50.
Summing up, WTI oil futures may stay in the bulls' control in the short-term, fighting for a continuation above the 73.00-74.00 resistance region. Otherwise, the recent consolidation phase may continue.
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