Fundamental
Overview
Crude oil has been rallying
steadily since the breakout of the range as the improving US manufacturing activity
and the tougher US sanctions on Russian crude triggered a 12% squeeze in a
heavily shorted market.
The focus now switched to
Trump as he’s expected to sign executive orders on energy and potential
declaring national emergency to boost domestic production and reverse Biden’s policies
on climate change.
Crude Oil
Technical Analysis – Daily Timeframe
On the daily chart, we can
see that crude oil eventually reached the key 80.00 handle where the price got
rejected from as the sellers stepped in to position for a drop back into the
72.00 support.
The price is now consolidating around the major broken trendline.
The buyers will likely keep
on piling in around these levels to position for a move above the 80.00 handle,
while the sellers will look for a break lower to increase the bearish bets into
new lows.
Crude Oil Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can
see that we have now an upward trendline defining the bullish momentum on this
timeframe. From a risk management perspective, the buyers will have a better
risk to reward setup around the trendline to position for further upside. The
sellers, on the other hand, will look for a break lower to increase the bearish
bets into new lows.
Crude Oil Technical
Analysis – 1 hour Timeframe
On the 1 hour chart, we can
see that we have a strong support zone around the 77.00 level where the price
got rejected from several times in the past days. This is where the buyers are
piling in to position for a rally into new highs, while the sellers are looking
for a break lower to target a drop into the trendline and then a break below it.
The red lines define the average daily range for today.
Upcoming
Catalysts
This week is pretty empty on the data front with just a couple
of key releases scheduled for the latter part of the week. Today, we have the
Trump’s Inauguration as the 47th US President. On Thursday, we get
the latest US Jobless Claims figures, while on Friday we conclude with the
Flash US PMIs.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
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