WTI oil futures extend sideways pattern

WTI oil futures (April delivery) have been stuck in a rectangle pattern since early November, appearing unable to adopt a clear trend. Meanwhile, the commodity has been gaining ground in the last few daily sessions, but the 50-day simple moving average (SMA) has capped its upside.

The momentum indicators currently suggest that buying pressures are intensifying. Specifically, the stochastic oscillator is ascending near its 80-overbought zone, while the MACD histogram jumped above its red signal line but remains below zero.

To the upside, if the price continues its latest advance, the recent resistance of 80.80 could prove to be the first obstacle for the bulls. Piercing through that zone, the price may challenge the crucial 82.65 territory, which has rejected the commodity’s efforts to break above the wide rectangle three times in January. Even higher, further upside moves could cease at the November high of 92.50.

Alternatively, should sellers re-emerge and push the price lower, initial support could be met at the 73.80 hurdle. Breaking beneath that wall, the February low of 72.70 might curb the commodity’s decline. Failing to halt there, the price could descend to test the 14-month low of 70.30.

In brief, WTI oil futures remain stuck within a rangebound pattern for the last four months, while their latest attempts for a rebound have stalled at the congested region, which includes the 50-day SMA and the lower boundary of the Ichimoku cloud. Hence, an exit from the rectangle is required for the price togain somedirectional impetus.

About the author

Stefanos Oikonomidis

Stefanos bergabung XM sebagai Analis Junior pada September 2021. Ia melakukan riset pasar harian pada mata uang, komoditas dan pasar ekuitas, dari perspektif fundamental dan teknis. Sebelum bergabung di XM, ia memperoleh wawasan berharga dengan bekerja sebagai Pekerja Magang Risiko Kredit di bank besar Yunani.

Stefanos meraih gelar Master di bidang Finansial dari Warwick Business School dan gelar Sarjana di bidang Akuntansi dan Finansial dari Athens University of Economics and Business. Ia percaya bahwa untuk menjadi sukses di industri, Anda harus bisa mengidentifikasi kekuatan pendorong di balik setiap pergerakan pasar, dan dibahas secara jelas dengan para pembaca.