Oil and Natural Gas Technical Analysis: Consolidation Continues Ahead of Fed and OPEC Triggers

Oil prices fell slightly on Monday as markets reacted to OPEC’s signal of another output increase. Eight member nations are considering raising supply in December, driven by Saudi Arabia’s effort to reclaim market share. This exerted downward pressure on prices despite renewed US sanctions on Russia.

Trade optimism between the US and China helped limit further losses, as hopes for a trade framework and a tariff pause boosted sentiment. However, traders remain cautious about how much this will impact actual demand and supply flows.

At the same time, concerns over weak global demand continue to weigh on the market. While stronger US consumption provides some support, the production shift by OPEC+ and sanctions-related uncertainty in Russia are creating mixed signals. Brent oil (BCO) and WTI oil (CL) closed lower after strong gains last week, reflecting the ongoing tug-of-war between supply dynamics and geopolitical risks.

WTI Crude Oil (CL) Technical Analysis

WTI Oil Daily Chart – Consolidation at Resistance

The daily chart for WTI crude oil shows the price has rebounded from long-term support at $56 and is now testing strong resistance near the 50-day SMA. This resistance begins around $62 and extends up to the $65 region, which aligns with the 200-day SMA.

A breakout above $66 could trigger another strong move to the upside. Moreover, the RSI has moved back above the midline, indicating further bullish potential. However, a drop below $60 or weak consolidation could keep the overall trend negative for WTI crude oil.

WTI Oil 4-Hour Chart – Consolidation at Resistance

The 4-hour chart for WTI crude oil shows strong consolidation below $60. Key resistance remains between $65.50 and $70. A break above $64 could trigger a move toward $66. If the price breaks above $66, it may open further upside potential toward $70. However, as long as WTI crude oil stays below $66, the trend remains bearish.

Natural Gas (NG) Technical Analysis

Natural Gas Daily Chart – Ascending Broadening Wedge Pattern

The daily chart of natural gas shows the price has been trading within an ascending broadening wedge pattern, suggesting intense volatility. The price is currently consolidating between the 50-day and 200-day SMAs, suggesting compression.

A break above $3.60 could push natural gas toward $3.80–$3.90. A breakout above $3.90 would be a bullish signal and could open the way for further upside toward $5.00. As long as natural gas holds above the $2.60–$2.50 support zone, the long-term trend remains intact.

Natural Gas 4-Hour Chart – Trend Line Resistance

The 4-hour chart for natural gas shows substantial consolidation between $3.50 and $3.60, just below the black-dotted trendline. A rebound from the long-term support zone of $2.60 to $2.90 has kept prices capped below this resistance band. A breakout above $3.60 could trigger a further move to the upside, with potential targets in the $4.10 to $4.70 range.

US Dollar Index (DXY) Technical Analysis

US Dollar Daily Chart – Consolidation

The daily chart of the U.S. Dollar Index shows it has been consolidating above 96.50 within a tight trading range. This narrowing range reflects caution ahead of the Federal Reserve‘s upcoming interest rate announcement. The next significant move in the index will likely be triggered by the Fed’s decision and developments in U.S.-China trade talks.

From a technical perspective, as long as the index remains below 100.50, the trend remains bearish. However, a break above 100.50 could open the path toward the 102.00 level.

US Dollar 4-Hour Chart – Consolidation

The 4-hour chart of the US Dollar Index shows strong consolidation between 96.50 and 100.50. This consolidation suggests that the index is waiting for a key trigger to determine its next significant move.