On July 30, crude oil has left a bearish GAP. In our previous articles, we had indicated a strategy that crude should reach that level and cover this gap, you can review the details here.
For this reason, we believe that in the next few days after crude oil makes a correction, it will be able to go up and cover this gap. No doubt, this hole should be covered. In fact, such gaps are always covered even if it takes a day, a month or a year or even years, according to our experience. Therefore, you can buy in a support zone at 71.88 or 70.31 with targets at 73.80, (GAP level).
Crude oil (WTI - #CL) rose to the highest level of this month at 73.12, very close to the 7/8 line of murray. In a single day, it jumped more than 240 pips. From the support of the SMA of 21, the price has been bouncing more than 500 pips, which shows that it could be reaching oversold levels.
Yesterday crude inventories data was published in the US. There was a decrease of - 6.4 million barrels in the week ending September 10. This data gave a strong upward momentum to Crude which helped it to reach the level of August 2 around 73.00 dollars per barrel.
Now in the Asian session, it is trading below yesterday's highs. This is a sign that the bullish force is ebbing away and there could be a technical correction to the zone of 71.88. There is the line of 6 /8 of Murray, a level of strong support.
The zone of 71.88 will be a good point to buy crude again. A consolidation around this level will be considered as an opportunity to buy crude with targets at 73.44. If this level is broken, the price could rise to the psychological level of 75.00 (8/8).
On July 30, crude oil left a bearish GAP, in our previous articles we had indicated a strategy that crude should reach that level and cover this gap, you can review the details here.
According to the daily chart, since August 20, crude oil has formed a technical pattern called a bullish pennant, its target is the level of 76.20. However, it should break and consolidate above the level of 73.44 for a new bullish cycle. As the first target, we expect a close of the gap of July 30 (73.80) and finally the next level at 76.00.
This bullish outlook will be invalidated if crude makes a longer correction and consolidates below 71.88. Then, it will be the beginning of a bearish scenario that could push the price down to 70.31 and the psychological level.
Support and Resistance Levels for September 16 - 17, 2021
Resistance (3) 75.00
Resistance (2) 74.61
Resistance (1) 73.61
Support (1) 72.13
Support (2) 71.44
Support (3) 70.48
Trading tip for Crude Oil for September 16 - 17, 2021
Sell below 73.00 with take profit at 71.88 and 70.31 (5/8), stop loss above 73.44 (7/8).
Buy if the #CL rebounds at 71.88, with take profit at 73.44 and 75.00 (8/8), stop loss below 71.40.The material has been provided by InstaForex Company - www.instaforex.com