Oil prices fell sharply today after a surprise increase in US crude oil inventories, according to the Energy Information Administration’s (EIA) weekly report. The report showed a larger-than-expected increase of +6.2 million barrels, reflecting weak domestic demand.
The strength of the US dollar, supported by strong employment data, also contributed to pressure on energy prices, as a strong dollar makes oil more expensive for holders of other currencies.
In addition, markets temporarily shrugged off geopolitical tensions, easing supply concerns and opening the way for a strong correction.
Technical Analysis of Crude Oil: Technical Overview of the Chart
- The price broke important technical support at 67.10 and is now trading around 66.25.
- There is a clear weakening in positive momentum, with a sharp downward movement below the moving averages.
Overall Trend: Strongly bearish.
Nearest support: 65.64, then 64.65.
Next resistance: 67.10 – 68.10.
Technical Analysis of Crude Oil: Technical Indicator Analysis
Moving Averages (EMA):
- Price below the 50-, 100-, and 200-period averages.
- All are sloping downward with clear bearish momentum.
- • Increasing negative bars, and a clear bearish crossover.
- • No signs of a slowdown in the selling wave yet.
- Stochastic Oscillator:
- • The indicator is in the oversold zone (below 10).
- • We may witness a limited technical rebound, but selling
Expected Scenarios
Expected Scenarios
Bearish Scenario:
- Continued decline Towards 65.64
- If this level is broken, the next target is 64.65.
Bullish Scenario:
- Limited technical rebound towards 67.10 (which may serve as a new selling point).
- The trend will not turn bullish until a close above 68.10.
Trading strategies based on Buy/Sell level
| USOIL | In case of buying | in case of selling |
| Entry point | 67.10 | 65.64 |
| Target Point 1 (TP1) | First resistance: 68.10 | First support: 64.65 |
| Target Point 2 (TP2) | Second resistance: 64.10 | Second support: 62.90 |
| Stop Loss (SL) | 65.64 | 67.10 |
Oil is currently experiencing a strong sell-off due to simultaneous fundamental and technical pressures. A breakout of key support areas without strong resistance indicates that the market has entered a deep correction. From a technical and economic perspective, the best opportunities remain in exploiting any temporary upside for selling, especially if US data remains strong and the dollar continues to rise. Buyers are advised to wait until clear reversal signals emerge and the price re-enters above 68.10.
