In the early US session on Wednesday, Crude Oil (# CL- WTI) is trading at 68.00 showing a strong upward trend. Since the beginning of this week, it rose more than 600 pips, which represents a 9% profitability in 2 days.
Today, Wednesday, Crude Oil seems to be reaching strong resistance, since the eagle indicator that measures the strength and volume of the market, is showing a sign of exhaustion. This indicator has reached the level of 95, which represents an imminent correction in the next few hours.
In a few hours, the data on weekly crude inventories will be published, a positive data of -1.9M is expected. If it turns out to be more negative, it could give the upward momentum to the line of 4/8 murray located at 68.75.
This level of 4/8 murray is a key point as it acts as strong resistance. As long as the price remains below this level, it will be a good opportunity to sell with the targets at the 2/8 murray located at 65.62.
The 200 EMA zone exerts downward pressure on Crude oil located at 69.34. This level acts as dynamic resistance, therefore, a failed attempt to break through this level will be a good selling opportunity.
Our outlook will be bearish as Crude Oil is below the 200 EMA on the 4-hour chart. Any attempt to break through it will be taken as an advantage to sell. The eagle indicator that is showing overbought conditions supports our outlook.
The key is to sell at current price levels around 68.00 or wait for a pullback to 68.75, with take profit at 67.00 and 65.62 (21 SMA).
Support and Resistance Levels for August 25 – 26, 2021
Resistance (3) 70.09
Resistance (2) 69.32
Resistance (1) 68.47
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Support (1) 67.17
Support (2) 66.00
Support (3) 64.56
