Crude oil prices witnessed a significant increase in trading over the past few days, supported by reports of a decline in US inventories issued by the Energy Information Administration (EIA). The announcement of an unexpected decline in inventories of 3.8 million barrels reinforced the positive outlook for oil prices.
In addition, geopolitical tensions in the Red Sea and the continued decline in the number of active drilling rigs contributed to supporting prices, in addition to optimism about increased demand with the start of the summer season in the United States.
Crude Oil: Technical Overview of the Chart
- Oil is trading in a clear ascending channel on the hourly (H1) chart.
- Previous resistance at 70.25 has been broken and has now turned into strong support.
- The price is currently consolidating above the 71.00–71.35 area within a narrow consolidation range (an accumulation square).
- Next strong resistance is at 72.56.
Overall trend: Upward as long as the price is above 69.90.
Nearest support: 70.25–69.90.
Next resistance: 71.90–72.56.
Crude Oil: Technical Indicator Analysis
- Moving Averages (EMA):
Price is above the 50, 100, and 200 EMAs – a sign of strong upward momentum.
The 50 EMA is moving at a positive angle and forming dynamic support.
- MACD:
Positive momentum continues, with MACD bars above the zero line.
There are still positive signals in the short term, but momentum is slowing down relatively.
- Stochastic Oscillator:
The indicator is oscillating between the 55-60 levels, which are neutral zones, reflecting the possibility of continued consolidation before a new price explosion.
Crude Oil: Expected Scenarios
Bearish Scenario:
- A break of the 71.00 area will open the way for testing the dynamic support at 70.25.
- If 69.90 is broken, the technical picture will temporarily shift to neutral/negative.
Bullish Scenario:
- A clear break of the 71.90 level will push the price directly towards 72.56.
- A close above 72.56 may open the way for targeting the 73.30-74.00 levels.
Trading strategies based on Buy/Sell level
| USOIL | In case of buying | in case of selling |
| Entry point | 71.66 | 70.48 |
| Target Point 1 (TP1) | First resistance: 72.56 | First support: 69.91 |
| Target Point 2 (TP2) | Second resistance: 73.50 | Second support: 68.90 |
| Stop Loss (SL) | 70.48 | 71.66 |
Based on technical analysis and anticipated economic news, traders are advised to monitor the above-mentioned support and resistance levels. If the support level of 1.0800 is broken, the decline may continue towards 1.0750. If the resistance level of 1.0900 is exceeded, the pair may witness a rise towards 1.0950. It is always advisable to follow economic news and geopolitical developments, as they play a crucial role in determining market trends.
