Oil has returned to its bearish trend
24 March 2023
This week has been a rollercoaster ride for most instruments, including commodities. While gold took the spotlight with an upswing above $2000 per ounce, interesting things were also happening in oil - not as spectacular, but definitely crucial and technical. In this analysis, our focus is on WTI oil.
Oil started the week with optimism, driven by relief in the banking sector and a general risk-on mode in the market. Crude was also benefiting from weakness in the US dollar, which is generally a bullish factor for commodities. While there was a rise, it was far from the one seen in gold - oil doesn't have safe-haven status, after all.
Yesterday, the price created a shooting star candle on the daily chart, which could mark the end of the bullish correction in the market. A shooting star is usually a bad sign for buyers, especially when it's present on a key resistance level like this one. The yellow resistance area at around $72 per barrel was a key support level in February, January, and December. As long as we stay below this level, the sentiment is negative, and the chances of seeing new long-term lows are much greater than the positive scenario.