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Crude Oil Price Forecast – Crude Oil Markets Testing Major Resistance

By:
Christopher Lewis
Published: Apr 4, 2023, 14:48 GMT+00:00

Crude oil markets have been somewhat quiet during the trading session on Tuesday, but by being quiet, that’s actually a very bullish thing.

Crude oil, FX Empire

In this article:

Crude Oil Prices Forecast Video for 05.04.23

WTI Crude Oil Technical Analysis

The West Texas Intermediate Crude Oil market has done very little during the trading session on Tuesday, which ironically is a very bullish sign. After all, the Monday gap to the upside of over 5% is a very strong sign. The market continues to see the 200-Day EMA is an area that a lot of traders will pay close attention to for technical signals, and it’s probably worth noting that the 200-Day EMA sits right around the top of the previous consolidation, in the form of the $82 level.

We do have a massive gap underneath, and it could very well be filled soon. The 50-Day EMA is currently sitting at the $75.44 level and rising, which sits right at the bottom of the gap. Gaps do tend to get filled given enough time, so a short-term pullback could be expected, but if we do see a little bit of a pullback and a bounce, then I think that would be a very bullish sign. That being said, the fact that OPEC had to do a surprise production cut suggests they have a lot of concerns when it comes to future demand. That being said, a daily close above the 200-Day EMA is a bullish sign.

Brent Crude Oil Technical Analysis

Brent has been relatively bullish during the trading session on Tuesday, reaching towards the highs of the Monday session. That being said, the 200-Day EMA currently sits just above the $87 level and is dropping. The 200-Day EMA could be a significant amount of resistance. If we do pullback from here, then the market could go looking toward the 50-Day EMA and perhaps even fill the gap. The gap getting filled is something that you see quite a bit in futures markets, so a pullback and a sign of a bounce in the bottom part of the gap would be a very bullish sign. On the other hand, if the market were to break down below the gap, then we could go down to the $75 level.

Ultimately, there are a lot of questions out there as to whether not supply or demand is going to be the major driver of where the market goes next. I suspect we have a lot of noise ahead of us, so you should be very cautious about the position sizing going forward.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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