Daily Chart – Longer-Term Bias: Neutral

4-hour Chart – Short-Term Outlook: Bullish

Thursday 25th July

Oil has closed unchanged at US$78.34 in a n inside day with lower highs and higher lows from previous range. This distribution day has started to correct an oversold position. We still expect further sideways price action to continue in the near term. The technical picture remains unchanged support at lows of US$77.25 and then at US$72.65 the swing low of last 2-month increase. Resistance at US$78.47 and then at US$81.00. Outlook maintained as Neutral

the 4-hour chart remains in a down trend of the last few days. it appears to have traced out a rounded bottom with swing lows at US$77.25. This with upward distribution bars is a positive sign. However, whilst prices remain below the descending trend line, we remain neutral. Support at US$77.25 and then at US$75.44. resistance at US$79.05 and then US$79.62

Wednesday 24th July

Oil closed down a further 1% to US$78.34. In the trading session it traded to the 0.618% Fibonacci target at US$77.30 we expected and bounced. This test of this level and rejection with a long tail suggests to us that it is prudent to move outlook to neutral. A pullback of this size coupled with an oversold position indicates that profits should be taken. We expect that there will be a period of distribution at these lower levels before a new trend emerges. Support at today’s session lows of US$77.25 and then at US$72.65 the swing low of last 2-month increase. Resistance at US$78.47 and then at US$81.00. Outlook changed to Neutral

The 4-hour chart confirms the price rejection of the 0.618 Fibonacci retracement and has put in a few periods of positive bars. Similarly with the daily chart this rejection and achievement of target moves the outlook to Neutral. A turn up of the slow Stochastic and imminent crossover supports a thesis of price distribution at these interim lows. Support at US$77.25 and then at US$75.44. resistance at US$79.62 and then US$81.00

Tuesday 23rd July

A further fall in Oil on Tuesday saw the commodity fall 0.69% to US$ 79.142. In the process of the day the 50% retracement level of US$78.74 was tested and rejected.  In addition, it has moved to close above the 200-day moving average and is currently in an oversold position. Technically the market is still pointing to the 0.618 Fibonacci level at US$77.30, however it may be prudent for traders to move any stops lower to protect against impulse buying entering the market. Support at yesterday’s low at US$78.47 and then at US$77.80. Resistance at US$80.33 and then at US$81.00 area.

The 4-hour chart is in a solid downtrend but appears to me trying to trace out some support off session lows at US$78.47. This distribution will be necessary for any future falls to be sustained. A crossover of short period moving averages in the last 3 price periods is a bearish sign, however a turn up in the slow stochastic is providing a conflicting signal. we maintain bearish outlook but will close stop losses in place. resistance at US$79.95 then at US80.96. Support at US$78.47 then at US$77.80. 

Monday 22nd July

Oil was down 2.08% on Friday to close at US$79.609. this close was below the 0.382% Fibonacci level and suggests a pullback to the 50% level at US$78.74. The 200day moving average also currently stands at the same price level. This level will be the next support and below there at interim lows and congestion area around US$77.80. Momentum is now in the oversold area and needs to be monitored. Resistance will be at US$81.67 and then US$83.88, both levels having been rejected as highs with long tails. Maintain Bearish outlook.

The 4-hour chart has broken support level at US$80.33 and closed well below it. A large down period when it has taken out the support at US$80.33 has shifted close to all be below the period moving averages. This is a bearish signal.  momentum has correspondingly moved to an oversold position. We would expect a few periods of distribution around current lows before a further pullback occurs. Supports at US$78.74 and then at US$77.80 region.  resistance at US$80.33 then US$83.88. Change of outlook to Bearish

Friday 19th July

Oil closed down 0.95% to US$81.91 on Thursday a fall of US$0.83. The pullback today has left a long tail rejection of today’s high at US$83.36. This rejection provides our bearish outlook more conviction after the earlier day’s impulsive rally. We again will need to see a move above interim highs of $US83.88 which would confirm recent pullback has been completed. Support comes in at interim lows of $US80.33 and then at 50% retracement of US$78.65

The 4-hour chart has traced out a rounded top and this should cap any advances at the swing high of US$83.36. Price action however does not indicate any change to our neutral outlook. The current close below period moving averages further clouds the outlook. Support at swing lows of $US80.336, should that break, we would expect a deeper pullback