Downward Reversal in Oil Is Knocking on the Door
May 22, 2019 (Investorideas.com Newswire) Crude oil hasn't closed higher yesterday and the previous series of rallies appears to face stiff headwinds. Is this it, or can the oil bulls pull a rabbit out of their hats? After all, they've reversed Monday's downswing already. Or does the prospect of wide spectrum U.S. - China uncertainties have the upper hand? It's making itself heard across the board and crude oil is no exception. Let's assess the technical picture now.
We'll take a closer look at the chart below (chart courtesy of http://stockcharts.com).
Yesterday's crude oil trading was almost a mirror image of the Monday's session. While the bulls eked out minor gains on Monday, it was the bears who was stronger yesterday. The price closed down below the 50% Fibonacci retracement yet again. This has been the fourth unsuccessful attempt to overcome it in a row.
As we have pointed to in our yesterday Alert's title ("The Shifting Sands in the Oil Arena"), this suggests a bearish reversal of fortunes ahead. Indeed, at the moment of writing these words, black gold changes hands at around $62.20 which is back inside the blue consolidation.
Should the commodity keep moving lower from current levels, we're likely to see at least a test of the lower border of the blue consolidation. Such a move lower is supported by the unconvincingly low volume of the preceding upswing days.
The full version of the above analysis includes a helpful summary of the market outlook and our open position. If you enjoyed the above analysis and would like to receive daily premium follow-ups, we encourage you to sign up for our Oil Trading Alerts also benefit from the trading action we describe. We encourage you to sign up for our daily newsletter, too - it's free and if you don't like it, you can unsubscribe with just 2 clicks. If you sign up today, you'll also get 7 days of free access to our premium daily Gold & Silver Trading Alerts. Sign up for the free newsletter today!
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