Crude Oil turned bearish earlier this month, after being bullish for about a year, since the US WTI crude came back from $-37 ast April. The economic uncertainty and the recession in Europe and in the UK haven’t affected the bullish run n crude Oil too much.
Although, it turned bearish this month and has been trading in the lower bound since the middle of the month. Russia and OPEC agreed to postpone the production quotas they have in place, which gave Oil a $2 boost earlier this week, but that bullish momentum didn’t last long.
US crude Oil found resistance at the 200 SMA (purple) yesterday and reversed back down. Although, the 50 SMA (yellow) has turned into support on the H4 chart now. It held the decline yesterday and it is holding again today, although the price is not bouncing off of it, which is a signal that the pressure remains to the downside.
That’s great for us, since we have an open sell signal here, which we opened just below $61. We are in profit on this trade, which we opened last Friday and we are going to hold this position, hoping that the 50 SMA will break soon, which would open the door for $59 and lower.