WTI Crude Oil Price Analysis for Aug. 7, 2020

Free $100 Forex No-Deposit Bonus

WTI crude oil is still in correction mode but could be due to resume its uptrend soon as it closes in on the rising trend line on its 1-hour chart. This lines up with a few other inflection points where more buyers are waiting.

In particular, it coincides with the 61.8% Fibonacci retracement level around $41.50 per barrel and a former resistance level that might hold as support. It’s also close to the 200 SMA dynamic inflection point that could be the line in the sand for a pullback.

On the subject of moving averages, the 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, support levels are more likely to hold than to break.

RSI is heading lower to signal the presence of bearish pressure, but the oscillator is approaching the oversold region to indicate that sellers could use a break soon and allow buyers to take over. Stochastic is also pointing down to suggest that sellers are in control but that oversold conditions are about to be met. Turning higher could mean that buyers are ready to take over.

Crude oil is under a bit of downside pressure as traders are weighing in the impact of looser OPEC restrictions on global supply. Note that demand is still expected to be weak as the pandemic has yet to be under control, which means that business and consumer activity might remain weak in the foreseeable future.

Still, the latest inventory data from the Department of Energy has been promising as it reflected a larger than expected draw in stockpiles. This suggests that demand for fuel and energy has been somewhat supported in the past week, although the upcoming NFP release could have a strong impact on overall market sentiment.

Copyright © 2020. All Rights Reserved. FXDailyReport.Com
Risk Warning: Trading CFDs is a high risk activity and you may lose more than your initial deposit. You should never invest money that you cannot afford to lose. FXDailyReport.com will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets.