Oil has recovered slightly
from its most recent slump. On the 24th of August the commodity hit
its low for the year and rallied upwards throughout previous week. You may see
three waves up on the chart, which means the security, may be due for a
correction or a fall back to previous lows. In any case, the most logical thing
to happen now is some consolidation at the level or a topping process and then
a move down in waves.
You may also spot 200 sma
and ema on 4 hour chart and price stalling when it hit the indicator. I assume
a lot of traders have taken their profits off the table when the price touched
the indicators.
Of course, another rally of
5 bucks is possible. In that case we would see 50 or 51 in US oil. I tend to
think we would probably end closer to 50.50, because the level marks previous
support of consolidation on the way down.
Anyway, we need to wait and
see how the market performs on Monday and Tuesday to see whether a move up or
down is more likely.
Long term trend: down
Intermediate trend: down
Short term trend: up
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