Crude Oil Price Outlook: Resistance Broken, Further Gains Ahead
- Crude oil’s 20%+ bull market continues unabated but market becoming overbought.
- Oil could retrace 50% of the October-December 2018 slump.
Crude Oil Rally Brushes Off Economic Fears
Crude oil touches a fresh one-month high and is likely to push higher as the charts take another bullish twist. Crude oil has brushed off concerns that the global economic growth is slowing and aided by a slightly weaker US dollar and OPEC+ supply cuts is close to recovering half of its recent losses. The ongoing trade spat between the US and China is being pushed to the side, while the partial US government shutdown, and US President Trump’s non-attendance at the upcoming World Economic Forum in Davos, is also being ignored as bulls control the oil space.
On the charts oil looks like it has further to go with the current spot price decisively above both the 20- and 50-day moving averages. In addition, the 61.8% Fibonacci retracement level at $60.63/bbl. has been broken, leaving the December 7 high around $63.75/bbl. as the next target. Above here the 50% Fibonacci level at $65.59/bbl. is key. The RSI indicator is suggesting that the market is becoming overbought and this may act as a brake on any further upside momentum.
Brent Crude Oil Daily Price Chart (April 2018 - January 11, 2019)
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