CFD Update: Have sellers regained control of Oil?
Today we’re looking at oil. At the end of last week, sellers looked to have regained control, pushing price lower on Thursday and stalling the recovery trend. Friday’s buyers did win the session, but the bar failed to test Thursday’s high.
Today we saw the price open 1.73% lower and quickly move back down to 109.50 before some buyer resistance emerged. 110 does show some short-term support, but our focus, for now, is on another pattern that has started to form.
Looking at the daily chart, we were watching the recovery with interest to see if sellers could stall the rally and set up a Lower High pattern. That has started to come into fruition with last Thursday’s price stall and today’s move lower.
From here, if you’re a bear, you would want to see selling continue at a close below the moving averages and through current ST support. The fast trend has also been broken, so if momentum continues, and we see further selling, the medium-term trend line could be the next target, only if sellers can continue to get the ball rolling. Any counter-rallies from this point, we will want to see new lower highs form with lower lows after support is broken.
If we see a new move from buyers that can close above last Friday’s close, that would be a warning, and a new move above 118.06 cancels out the LH and suggests buyers still remain in control.
Oil D1 Chart 
* The information provided on this page are the opinions of the author and do not necessarily reflect the opinions of Eightcap and are not endorsed by Eightcap.
Any person acting on the information presented on this page does so entirely at their own risk. No representation or warranty is given as to the accuracy or completeness of this information. Any research provided does not have regard to any specific investment objectives, financial situation and needs of any specific person who may receive it.
Margin trading involves a high level of risk and may not be suitable for all investors. You should carefully consider your objectives, financial situation, needs and level of experience before entering into any margined transactions with Eightcap, and seek independent advice if necessary.