The price of Crude Oil #CL is trading 70.12, around the psychological level of 70.00. Now this level has become strong resistance for crude oil. The bullish force is running out and a correction could occur in the next few hours towards the support the 200 EMA around 68.75.
The price of crude oil remains at daily highs. If the upward force prevails, the price could continue its rise towards the 6/8 murray zone at 71.86. For this, it should consolidate above 70.31.
Crude Oil is receiving support from the sharp decline in US crude inventories. However, this was overshadowed by the decision of the Organization of Petroleum Exporting Countries and its allies (OPEC +) to continue with the gradual increases in production. If this trend continues in the short term, Crude could reach the level of 74.00 dollars per barrel.
Another factor that could propel a further rally of oil prices is Hurricane Ida, which affected oil and gas production in the Gulf of Mexico. So, production facilities need some time to operate at full capacity again.
According to the chart, as long as the oil price is above the SMA of 21 and the EMA of 200, today at 68.75 today, there will be a good opportunity to continue buying with targets at 71.88 and up to 74.00.
Conversely, if crude falls below the 4/8 murray support and the 200 EMA, it could change the trend and a price drop towards the 67.19 and to the 65.62 support level.
Our outlook will continue to be bullish as long as it is above the 200 EMA and above 68.75. We can buy around these levels. The eagle indicator is showing a downward correction signal. Therefore, we should expect a setback in the coming days.
Support and Resistance Levels for September 03 - 06, 2021
Resistance (3) 72.15
Resistance (2) 70.96
Resistance (1) 70.31
----------------------------
Support (1) 69.40
Support (2) 68.75
Support (3) 68.21
***********************************************************
Trading tip for Crude Oil for September 03 - 06, 2021
Sell below 70.31 (5/8) with take profit at 68.75 and stop loss above 70.75.
Buy if the crude rebounds at 68.75 (4/8 and EMA 200) with take profit at 70.31 (5/8) and stop loss below 68.30.
