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Crude Oil Price Remains At Risk of More Losses

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Aayush Jindal

Key Highlights

  • Crude oil price started a downward move after itbroke the $63.40 support against the US dollar.
  • There is a key bearish trend line formed withresistance at $61.85 on the 4-hours chart of XTI/USD.
  • The IBD/TIPP Economic Optimism Index increasedfrom 54.2 to 58.6 in May 2019.
  • The EIA Crude Oil Stockpiles figure is likely tochange by 0.744M, compared with the last 9.934M.

Crude Oil Price Technical Analysis

After a strong rise, crude oil price faced selling interest near the $66.50 level against the US Dollar. The price started a steady drop and traded below the $65.00 and $64.00 support levels.

Crude Oil Price Technical Analysis

Looking at the 4-hours chart of XTI/USD, theprice moved into a bearish zone below the $63.40 support level. During thedecline, there was a break below couple of connecting bullish trend lines, plusthe 100 (red) simple moving average (4-hours).

The price even settled below the $62.20 level and the 200(green) simple moving average (4-hours). A swing low was formed at $60.00 andthe price recently corrected higher.

However, it topped near the $62.90 level and declined belowthe 61.8% Fib retracement level of the last wave from the $60.00 low to $62.89high. On the downside, the main support is near the $60.00 level and aconnecting trend line.

If there is a daily close below $60.00, the price could dropsignificantly below the $58.00 and $56.00 levels. On the upside, there is a keybearish trend line formed with resistance at $61.85 on the same chart.

A successful close above the $62.00 and $62.20 levels ismust to kick start a fresh increase towards the $64.00 and $65.00 levels in thenear term.

Looking at major pairs, EUR/USD was confined in a range below the key 1.1250 resistance and GBP/USD corrected lower below the 1.3080 level.

Economic Releases to Watch Today

  • Germany’s Industrial Production for March 2019(MoM) - Forecast -0.5%, versus +0.7% previous.
  • US Producer Price Index March 2019 (YoY) –Forecast +1.9%, versus +1.9% previous.
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