Crude Oil Price Rebounds After Forming Support Near $50

Key Highlights

  • Crude oil price formed a decent support near $49.50 and $50.00 against the US dollar.
  • There was a break above a major bearish trend line with resistance at $51.50 on the 4-hours chart of XTI/USD.
  • The Euro Zone Services PMI in Nov 2018 increased from 53.1 to 53.4.
  • Today, the US Services PMI for Nov 2018 will be released, which is forecasted to remain at 54.4.

Crude Oil Price Technical Analysis

During the past few days, there were heavy declines in crude oil price from the $60.00 swing high against the US Dollar. The price even broke the $55.00 and $54.00 support levels before buyers emerged near $50.00.

Crude Oil Price Technical Analysis Chart

Looking at the 4-hours chart of XTI/USD, the price traded as low as $49.25 and later formed a decent support near the $49.50 and $50.00 support levels. As a result, there was an upward move and the price traded above the $51.00 and $52.00 resistances.

The price even broke a major bearish trend line with resistance at $51.50 to enter a short term bullish zone. Later, buyers pushed the price above the $54.00 level and the 50% Fib retracement level of the last decline from the $57.95 high to $49.25 low.

However, there is a strong resistance near the $54.50-55.00 zone and the 100 (red) simple moving average (4-hours). A convincing break above the $55.00 resistance is needed for a larger recovery in the near future.

On the other hand, an immediate support is near the $51.80 level, below which the price may perhaps retest the $49.50-50.00 support area.

Both major pairs, EUR/USD and GBP/USD seem to be struggling to gain bullish momentum and it seems like the US Dollar may continue to rise in the short term.

Economic Releases to Watch Today

  • US Initial Jobless Claims – Forecast 220K, versus 234K previous.
  • US ISM Non-Manufacturing Index for Nov 2018 – Forecast 59.2, versus 60.3 previous
  • US ADP Employment Change Nov 2018 – Forecast 195K, versus 227K previous.
  • US Services PMI for Nov 2018 – Forecast 54.4, versus 54.4 previous.

Aayush Jindal

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets.

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