Crude oil traded around $98.15 amid strong downward momentum after breaking below the uptrend channel that had formed since May 6. It is now showing a slight recovery, but could resume its downward trend in the coming hours.
Crude oil could find strong support around the 200 EMA at $95.58, which could trigger a technical rebound up to the 21 SMA at $101.46. The instrument could even reach the upper band of the trend channel around $102.30.
If crude oil reaches the 8/8 Murray level around the psychological level of $100.00 in the coming hours and fails to consolidate above this zone, it could be seen as a signal to sell with targets at $95.58 around the 200 EMA. We could even expect a break below this zone to fill the gap left on May 7 around $91.45.
According to the H4 chart, crude oil has broken the uptrend channel and is now consolidating below this zone. Thus, we believe it could continue its fall in the coming days. Our strategy will be to sell USD/OIL in case of a technical rebound toward the $100 to $101.46 zone around the 21SMA.
The Eagle indicator is showing a bearish signal, so we will continue to look for opportunities to sell below the psychological level of $100.00 with short-term targets around the psychological level of $90.
