Commodities

Technical Analysis – WTI crude oil futures in slippery mode; bears break 49.00 level

Posted on December 18, 2018 at 9:04 am GMT

Melina Deltas, XM Investment Research Desk

WTI futures plummeted to a fresh 15-month low during yesterday’s session, challenging the 48.50 level. The price exited from the narrow range that was holding in the preceding three weeks, continuing the strong downside structure in the short to medium term.

Currently, the price remains below the 20- and 40-simple moving averages (SMAs) and the technical indicators hold in negative area. The RSI is flattening near the overbought levels, while the MACD is strengthening its negative momentum below the trigger and zero lines.

Further declines and a drop below the aforementioned 15-month trough could send prices towards the 47.50 support barrier, registered on September 2017. Even lower, support could occur around the 46.00 handle, identified by the lows on August 2017.

On the upside, resistance could come around the 20- and 40-simple moving averages (SMAs) in the 4-hour chart, at 51.15 and 51.50 respectively. Higher still, the 53.25 resistance would increasingly come into scope before the price retouches the 54.40 obstacle, which was acting as upper band of the trading range in the previous days.

Overall, the short-term outlook appears mostly bearish after the break of the trading range, and the medium-term one remains negative as well.

commodities WTI crude

Legal disclaimer: The material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instruments. XM accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. The research and analysis does not involve any specific investment objectives, financial situation and needs of any specific person who may receive it.

It has not been prepared in accordance with legal requirements designed to promote the independence of research, and as such it is considered to be marketing communication. Although we are not specifically constrained from dealing ahead of the publication of our research, we do not seek to take advantage of it before we provide it to our clients. We aim to establish, maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. We operate a policy of independence, which requires our employees to act in our clients’ best interests and to disregard any conflicts of interest in providing our services.

CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losing all of your invested capital, so please make sure that you fully understand the risks involved.