XM Group - Analytics

    XM Group

    602.50 7.00/10
    70% of positive reviews

    Technical Analysis – Oil falls into $28 handle, bearish bias strong

    The breakdown below the key $30 level last week has triggered a new downleg for oil prices.

    After closing at $29.61 on Friday, US oil opened with a gap lower to spike down to $28.35 early on Monday. There is scope for a further decline as the technical are bearish. On the hourly chart, the tenkan-sen and kijun-sen lines are negatively aligned and RSI is falling in bearish territory.

    Looking at the bigger picture, on the weekly chart, prices have been declining in a downward sloping channel from $50.89 (October 2015) to $28.35 today.

    The next support level comes in at a previous low near $22.70 (2003 low).

    The tenkan-sen and kijun-sen lines are negatively aligned on the weekly chart and pointing down, which is a bearish signal. Also the weekly Ichimoku cloud is falling, highlighting the bearish bias.

    The RSI however is at oversold levels below 30. This could suggest that the current downside momentum could be getting exhausted and we could see some consolidation in the near term.

    Risk Warning: Forex, Commodities, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full Risk Disclosure.

    To leave a comment you must or Join us

    By visiting our website and services, you agree to the conditions of use of cookies. Learn more
    I agree