WTI Crude Resistance Is Seen Around $42.00

07 July 2020

WTI Crude might be preparing to break below $37.00 interim lows and proceed towards $26.00 in the next few trading sessions. Bears might remain in control for now and carve lower lows and lower highs going further.

WTI Crude had print historic lows at $0.01 after a religious selloff in April 2020. Since then, it has staged an impressive rally towards $41.60, immediate resistance marked on the hourly chart presented here.

Also note that the previous rally from $0.01 through $41.60 seems to be complete (not seen here). Hence, WTI Crude could be preparing for at least a 3 wave corrective drop towards $26.00 and further. It is quite probable for the next leg of rally to resume thereafter.

Let us have a look at the potential counts since $41.60, recent swing highs. The drop from $41.60 through $37.00 has been labelled as Wave A, within the proposed A-B-C corrective phase. The subsequent corrective rally managed to reach up to fibonacci 0.786 retracement of Wave A.

The termination point around $41.00 has been labelled as potential Wave B. If the above short term wave counts are correct, WTI Crude should stay below $41.60 levels and proceed lower towards $26.00 at least.

Most traders might be willing to either remain flat or remain aggressively short from $41.00 levels. The protective stop would go above $42.00 and projected targets below $26.00 at least, as the corrective drop unfolds Wave C lower.

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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