Good morning Traders!
Crude Oil has been a key player within recent global conflicts, and also being squeezed between an ever-shortening fossil fuel supply and the ever-increasing popularity of electric vehicles. There’s no doubt that there’s an appetite for electric (or alternative fuel-based vehicles).
In the first few months of Russia’s invasion we saw a dramatic spike in demand for oil, and then after a brief touch below $94, took another run up to the top, but failed at $124. Price has since been steadily declining, most recently seeing a low as far down as $70.
When we look at the weekly chart, we can see that price is currently in a bullish, up-trending channel, with clear identifiable higher-lows and higher-highs.
There is a clear visual bearish trendline from the highs, and this has been breached in the last week. This normally hints that the bearish momentum may be over. The next step is to see if price can now find support in this area, and move higher.
Traders will be watching for price action to retrace back down into the $78-$80 area to find new buyers. Should price find a base here, and then subsequently moves higher than $82.50, there is likely enough evidence in the change of Oil’s behaviour to begin to lean bullish.
Happy Trading!
