Crude Oil Price Highlights:
- WTI crude oil showing weak price action, watch December t-line
- Brent crude similar but has t-line support keeping it afloat for now
Check out the intermediate-term fundamental and technical outlook in the Q3 Crude Oil Forecast.
WTI crude oil showing weak price action, watch December t-line
Crude oil came off a high mid-month rather aggressively, and since then it has failed to mount much of a recovery. This type of price action suggests that there could be downside follow-through in the coming sessions.
One could also look at the past month’s trading as a head-and-shoulders pattern with the right shoulder nearing completion. The hourly chart may be of some help here for would-be shorts as there is a clear short-term trend-line that is helping keep price supported. Price is also getting squeezed (triangle) within the parallels, a move of some type looks to be very near.
A break below the underside trend-line, with confirmation arriving via an hourly closing candle under 55.58 should have crude oil rolling downhill towards 54.73 and then the December trend-line. A test of the trend-line could prove important; a break will have the June low near 50 in focus, while a hold could keep oil continuing to chop around over the intermediate-term.
WTI Crude Oil Daily Chart (looking for December t-line)
WTI Crude Oil Hourly Chart (watch underside t-line)
Brent crude similar but has t-line support keeping it afloat for now
The Brent contract is of course acting similarly to WTI, but does have a line of support in place right now that its US counterpart doesn't. The December trend-line was met with buying recently, but the break of the June/July channel points to more follow-through from the April top.
Snapping the recent low at 61.60 will quickly have the June low at 60.28 in focus. A new intermediate-term low below that point will bring in a pair of long-term trend-lines rising up from 2016 (two starting points included). It would take some aggressive selling to get to those levels given they are in the 55/52 range, but certainly within the realm of possibility in the not-too-distant future.
Brent Crude Oil Daily Chart (t-line keeping it supported for now)
Brent Crude Oil by Tradingview
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
