Oil and Natural Gas Technical Analysis: Energy Market Eyes Rebound Amid Dollar Weakness

WTI crude oil (CL) is consolidating between the $64 and $65 region. The price action reflects growing concerns about weaker global demand after President Trump doubled tariffs on Indian imports. The tariff hike targets India’s refusal to halt Russian crude and defense purchases. The move sent a strong political signal but also disrupted trade dynamics. Investors fear the action could escalate into broader tensions, further weighing on oil demand.

At the same time, geopolitical tensions in Eastern Europe offered some support. Ukraine ramped up attacks on Russian infrastructure in response to drone strikes, while President Trump warned of additional sanctions if peace talks stall. These developments raised the risk of supply disruptions, which may limit the downside potential for WTI crude oil.

Additionally, expectations of a Fed rate cut in September are supporting commodity prices. With an 89% chance of a 25 bps cut now priced in, the US dollar faces downward pressure.

WTI Crude Oil (CL) Technical Analysis

WTI Oil Daily Chart – Consolidation

The daily chart for WTI crude oil indicates that the price is consolidating near the support of an ascending channel, located around the $64 region. This consolidation suggests that a rebound may be forming within the broader bearish trend.

The 50-day SMA remains below the 200-day SMA, indicating continued downside pressure. If WTI breaks above the 200-day SMA near the $67 level, it could trigger a rebound toward the red trendline around $74. A breakout above $74 would likely push prices further toward the $82–$84 region in 2025. However, if prices break below the $60 level, the next immediate support lies at $55.50. A move below $55.50 would signal a strong decline in oil prices.

WTI Oil 4-Hour Chart – Consolidation

The 4-hour chart for WTI crude oil shows strong consolidation within a neutral zone. Prices have been trading between the $60 and $70 range with no clear direction. Currently, the price is consolidating around the $60 level and forming a short-term inverted head and shoulders pattern, which suggests a potential rebound toward the $67 area in the near term.

Natural Gas (NG) Technical Analysis

Natural Gas Daily Chart – Rebound from Long-Term Support

The daily chart for natural gas (NG) shows a rebound from the long-term support in the $2.60–$2.70 region. This support marks the neckline of a cup-and-handle pattern, indicating that natural gas prices are likely to continue moving higher. The immediate resistance lies at the 50-day SMA near $3.17, and a break above this level could push prices toward the $3.60 region.

Natural Gas 4-Hour Chart – Rebound

The 4-hour chart for natural gas shows that the price is rebounding from the support zone between the $2.60 and $2.90 region. This rebound is supported by strong long-term support near the $2.60–$2.70 area. A breakout above the $3.00 level could pave the way for the $3.60 region. However, natural gas prices remain in a broad consolidation range between $3.00 and $5.00.

US Dollar Index (DXY) Technical Analysis

US Dollar Daily Chart – Bearish Pressure

The daily chart for the US Dollar Index indicates that it is trading within a bearish flag pattern, characterised by strong consolidation around the key inflection zone near the 97.60 level. This suggests the index may be preparing for another sharp decline.

The 50-day SMA and the lower support line of the bear flag mark the inflection area. Additionally, the RSI remains below the mid-level, reinforcing the negative trend and signalling further downside for the US Dollar Index.

US Dollar 4-Hour Chart – Negative Price Action

The 4-hour chart for the US Dollar Index shows bearish price action below the 100.50 resistance area. The index is currently consolidating between the 97 and 99 levels, awaiting its next move. A break below 96.50 would likely trigger another strong decline in the US Dollar Index.