Is $93 per Barrel Within Reach for WTI Oil?
04 September 2023
In today's technical analysis, it's impossible to overlook the remarkable performance of oil, specifically WTI, which has been experiencing an extraordinary end to August and a strong start to September. The bullish sentiment in the oil market has been underscored by a significant breakthrough. WTI oil has decisively surpassed a critical horizontal resistance level at $83 per barrel, an area highlighted in yellow on the chart. The asset is currently trading at its highest levels since November 2022, making it one of the standout commodities right now.
The breakout above this yellow resistance line activates a strong buy signal for WTI. As long as the price sustains above this level, the bullish sentiment is likely to persist. Looking ahead, the next significant target is set at $93 per barrel, denoted by a blue line on the chart, giving traders and investors a new level to set their sights on.
But what if the tide turns? In the bearish scenario where the price falls back below the yellow area, it would signal a false breakout, thereby activating a sell signal. In such an event, the likely downside target would be the green horizontal support level on the chart.
However, the current technical setup suggests that the odds are skewed in favor of further upside. The momentum, trend, and recent breakout above a significant resistance level all indicate that the chances for a continued rally are much higher than for a bearish reversal. Thus, the dominant narrative for WTI oil remains overwhelmingly positive, at least for now.