Crude Oil Prices Soar, Mostly Sealing the Fate of a Fourth Monthly Gain. Where to?

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Crude Oil, WTI, Retail Trader Positioning, Technical Analysis – IGCS Commodities Update

  • Crude oil costs all set for a 4th consecutive month-to-month achieve?
  • Still-bearish retail dealer publicity gives a bullish outlook
  • Prices simply barely break above a key zone of resistance

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How to Trade Oil

Crude oil costs rocketed larger on Wednesday, hovering 3.6 p.c in essentially the most aggressive day since early June. The commodity is heading in the right direction for a 4th consecutive month-to-month achieve. Meanwhile, retail merchants proceed rising bearish publicity. This may be seen by taking a look at IG Client Sentiment, which tends to perform as a contrarian indicator. Will this spell additional positive factors for oil?

Crude Oil Sentiment Outlook – Bullish

According to IGCS, solely about 30% of retail merchants are net-long crude oil. Since the bulk are biased to the draw back, this continues to trace that costs could rise down the highway. Meanwhile, upside bets have decreased by 10.3% and 16.32% in comparison with yesterday and final week, respectively. With that in thoughts, general publicity and up to date adjustments provide a stronger bullish contrarian buying and selling outlook.

of purchasers are internet lengthy.

of purchasers are internet brief.

Change in Longs Shorts OI
Daily -10% 6% 1%
Weekly -16% 21% 7%

On the every day chart under, WTI has simply barely closed above the 93.72 – 92.43 resistance zone from highs seen in November. That has opened the door to extending the uptrend since earlier this 12 months, exposing the 100% Fibonacci extension stage at 95.63. Just past that’s the August 2022 excessive of 97.65, which can maintain as key resistance.

But, observe that there’s a unfavourable RSI divergence displaying that upside momentum is fading. In the occasion of a flip decrease, dropping by means of the 93.72 – 92.43 former resistance zone locations the concentrate on the 20-day Moving Average. Just under that’s the 61.8% extension at 88.75.

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Crude Oil Daily Chart

Crude Oil Daily Chart

Chart Created in Trading View

— Written by Daniel Dubrovsky, Senior Strategist for

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