Oversupply issue persist

Despite the production cut in crude oil, the price of crude oil continues under pressure as other producers fill the gap created by the production cap. It is a losing battle by OPEC members, and the losses keep piling up as U.S discovering new oil deposit. There is no escape for the bull, and the price of crude oil should slide more.

OPEC seen under dilemma to extend its production cut program, Saudi Arabia Khalid Al-Falih cited the production cut seems to result in failure so far.

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New Month

Monthly chart

The monthly chart of crude oil shows the bull and the bear is in a stalemate. The price stick near the red trendline which is a long-term trendline. This month, it might continue stick near the trendline and wait for news catalyst to incite next movement.

Weekly chart

The bear is winning. Fortunately, it needs a close below blue trendline on weekly chart to confirm weakness. The price of crude oil might test the blue trendline this week, and traders could look for a bounce higher from the trendline. If the trendline was broken or a close below $47.00 happens, the price could easily slide toward $41.88.

Daily chart

Crude oil price on daily chart stay above daily SMA 200 which is bullish. This week, the price will test the averages and also trendline support. The test might provide a chance for a long position with tight stop losses, but a break lower below blue trendline will cancel the bullish outlook.