Crude Oil Price is Back in Downtrend Vs US Dollar?
- – Crude oil price started a downside move from well above $68.00 against the US Dollar.
- – There is a crucial declining channel in place with resistance near $65.25 on the hourly chart.
- – Recently in China, the Caixin Services PMI for May 2018 was released.
- – The outcome was around the market forecast as there was no change from the last reading of 52.9.
China’s Caixin Services PMI
Recently in China, the Caixin Services PMI for May 2018 was released. The market was positioned for a no change from the last reading of 52.9 in May 2018.
The actual result was around the market forecast as there was no change from the last reading of 52.9. Moreover, China’s Composite Output Index also was unchanged from April’s reading of 52.3.
Overall, the outcome was neutral and it seems like crude oil price current recovery may be capped near $65.25 and $65.50.
Oil Price Technical Analysis
After a decent upside move, crude oil price formed a short-term top near the $68.40 level against the US Dollar. The price started a downside move and broke a few important supports such as $68.00, $67.40 and $66.00.
The price settled below the $66.00 support and the 100 hourly simple moving average. It is also following a crucial declining channel with resistance near $65.25 on the hourly chart. The recent low was $64.52 from where the price started an upside correction.
The price has moved above the 23.6% Fib retracement level of the last decline from the $65.97 high to $64.52 low. However, there is a major hurdle on the upside near $65.25, channel, and the $65.50 barrier.
Moreover, the 50% Fib retracement level of the last decline from the $65.97 high to $64.52 low is also near $65.25 to act as a key resistance. If there is an upside break above the $65.25 level and $65.50, there is a chance of a recovery towards $66.00. On the other hand, if the price fails to move higher, it could resume its downtrend and it may perhaps break the last low of $64.52 to extend its decline.
Also published on Medium.
