WTI Crude Might Have Topped Around $42.50

4 August 2020

WTI Crude might be underway towards $32.50 at least, if not lower. The commodity seems to have carved a meaningful top around $42.50 levels on July 21, 2020. Since then, it has reversed lower and broken below its immediate trend line support.

Furthermore, WTI Crude has also broken initial price support around $39.00 levels as seen on the 4H chart here. The subsequent counter trend rally has also reversed from fibonacci 0.618 retracement around $41.10 levels.

Ideally, bears should remain in control from here and push prices lower towards $36.30 and $32.50 respectively, before reversing higher again. Let us now look at the probable wave counts for WTI Crude. After printing historic lows at $0.01 in April in 2020, WTI Crude has been on the rise.

The commodity has remained in control of bulls and managed to carve a series of higher highs and higher lows through $42.50 levels until recently. The rally from $0.01 through $42.50 seems to be in 3 waves, hence corrective.

WTI Crude prices may drop towards $32.50 and $16.00 levels in the coming sessions. It is too early to confirm but prices may consolidate within a trading range and unfold as a triangle, before breaking lower towards yet another low.

Traders might be preparing to initiate fresh short positions towards $32.50 and $16.00 levels over the near term. The protective stop would go around $43.00 mark and projected target towards $32.50 at least. Only a break above $42.50 would change the near term bearish view.

Prepared by
Technical Analysis Team

Disclaimer: This information has been produced by a third party, for general information purposes only, and is not indicative of future results. Abans Global takes no responsibility for its accuracy or completeness. Any opinions expressed do not reflect those of Abans Global. This information does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should seek independent advice before making investment decisions. Reproduction of this information, in whole or in part, is not permitted. Please note: If you are a Professional client, you are not eligible for negative balance protection and you could lose more than your initial deposit.

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