WTI OIL

22 May 2024
WTI Oil: 4-hourly and daily chart technical view

Daily Chart: Longer-Term Bias: Neutral

Resistance US$83.84-82.45 then US$87
Support US$78-77.12

4-Hour Chart: Short-Term Outlook: Neutral

Resistance US$83.84-82.45 then US$87
Support US$78-77.12

Wednesday 22nd May

Oil retreated -1.3% overnight to US$78.61 a barrel. On the daily timeframe, the price has turned lower with a retest of the 21-period moving average having held. Following corrective price action over the prior three weeks, this raises the possibility of downside back towards US$74.11. We maintain our neutral view, given the potential for momentum divergence to form on any weakness that is not sustained.

On the 4-hour timeframe, we revert to a neutral stance although recognise the mounting probability of a bounce in the coming hours with the price back around support at recent lows. Overall, the price remains within a large correction, with resistance around US$80 and support around US$78.

Daily Chart: Longer-Term Bias: Neutral

4-Hour Chart: Short-Term Outlook: Neutral

Tuesday 21st May

Oil was modestly lower at US$79.64 a barrel on Monday. On the daily timeframe, our analysis is unchanged as the price is once again lifting after a swing low has formed, which has the good potential for further gains given the slow stochastic is still at oversold levels. However, with no signs of trend exhaustion and a downtrend in place, we would expect any short-term gains to be corrective, and such price action towards US$82.45 may present a bearish opportunity.

On the 4-hour timeframe, a brief pullback has held support at the 21-period moving average. The price is attempting to lift up from a relatively large basing pattern, which is a positive sign in the coming hours and days suggesting further gains towards US$82.45 are more likely than not. We remain comfortable with our bullish view for now, although losses below US$78 would see this reassessed.

Monday 19th May

Oil rose a further 0.82% on Friday to US$79.99 a barrel. On the daily timeframe, the price is once again lifting after a swing low has formed, which has the good potential for further gains given the slow stochastic is still at oversold levels. However, with no signs of trend exhaustion and a downtrend in place, we would expect any short-term gains to be corrective, and such price action towards US$82.45 may present a bearish opportunity.

On the 4-hour timeframe, our analysis is unchanged, the price has rallied sharply and now pushing short-term momentum positive. The price remains within a relatively larger consolidation, and it would take a move above US$80.14 to suggest this was complete. We remain comfortable with our bullish view for now, although losses below US$78 would see this reassessed.

Friday 17th May

Oil rose 0.61% overnight to US$79.35 a barrel. On the daily timeframe, our analysis is unchanged as Wednesday’s price action is a bullish sign, coupled with recent lows suggesting that a key low is likely forming. However, with no signs of trend exhaustion and a downtrend in place, we would expect any short-term gains to be corrective, and such price action towards US$82.45 may present a bearish opportunity.

On the 4-hour timeframe, our analysis is also unchanged, the price has rallied sharply and now pushing short-term momentum positive. The price remains within a relatively larger consolidation, and it would take a move above US$80.14 to suggest this was complete. We remain comfortable with our bullish view for now, although losses below US$78 would see this reassessed.

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