The price of Crude oil #CL on the 4-hour chart is facing strong resistance at 68.75. The 4/8 murray line and the 200 EMA are also located there. This level has become a strong barrier for oil, consolidation above this level is expected to continue towards the next 6/8 resistance at 71.88.
On the other hand, crude inventories in the US decreased by 3 million barrels for the week that ended on August 20, according to the report released last Wednesday. This data does not appear to have had any significant impact on crude prices.
Candlesticks on the 4-hour chart show that crude has reached overbought levels and there could be a correction below the 200 EMA towards the 21 SMA at 68.05.
Around the SMA of 21, an uptrend channel is projected. If crude makes a technical bounce from this level, it will be a good opportunity to buy above 68.05 with the target at 68.75. Then, the price could reach the psychological level of 70.00.
If crude manages to consolidate above the 200 EMA and above the 4/8 murray, the outlook could turn bullish, and there could be a new bullish sequence with targets at 5/8 (70.31) and 6/8 (71.88) of murray.
Conversely, definitive consolidation below the 21 SMA located at 68.05 will be a negative signal for crude, and it could fall to the support of 2/8 murray located at 65.62. A good opportunity to sell appears below 68.00.
The technical reading of the eagle indicator that measures the strength and volume of the market is showing an overbought signal with an imminent correction in the coming days. Therefore, according to this signal, we must observe that crude remains below 68.75.
Support and Resistance Levels for August 30 - 31, 2021
Resistance (3) 70.82
Resistance (2) 69.92
Resistance (1) 69.30
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Support (1) 67.78
Support (2) 67.18
Support (3) 66.26
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Trading tip for Crude Oil for August 30 - 31, 2021
Sell below 68.75 (EMA 200) if the price breaks through 68.05, with take profit at 67.18 and 65.62 (2/8), stop loss above 69.20.
