WTI Oil Technical: Potential bullish reversal to resume medium-term uptrend

  • The recent decline of -6.8% from its 10 August 2023 high has not damaged the medium-term uptrend phase of WTI oil.
  • Today’s price actions have indicated a revival of a short-term uptrend phase.
  • Watch the key short-term support at US$80.90.

This is a follow-up analysis of our prior report, “WTI Oil Technical: Time for a potential short-term pullback” published on 15 August 2023. Click here for a recap.

The price actions of West Texas Oil (a proxy of WTI crude oil futures) have indeed shaped the expected minor short-term pull-back and broke below US$79.80 per barrel minor support as it printed an intraday low of US$79.11 last Thursday, 17 August.

All in all, it has recorded an accumulated decline of -6.8% from its 10 August 2023 high of US$84.92 but from a technical analysis perspective, the medium-term uptrend phase in place since 28 June 2023 low of US$66.95 remains intact.

Medium-term momentum has turned positive

Fig 1:  West Texas Oil medium-term trend as of 21 Aug 2023 (Source: TradingView, click to enlarge chart)

Recent price actions of West Texas Oil have led to the emergence of an imminent “golden crossover” bullish condition seen in the 50-day and 200-day moving averages.

In addition, the daily RSI oscillator has also just staged a rebound right at a key parallel support at the 50 level. These observations suggest that medium-term bullish momentum may have resurfaced which in turn increases the odds of the continuation of a potential impulsive up move sequence within its medium-term uptrend phase in place since the 28 June 2023 low.

Evolving into a minor short-term uptrend

Fig 2:  West Texas Oil minor short-term trend as of 21 Aug 2023 (Source: TradingView, click to enlarge chart)

 Today’s price action has just surpassed the 20-day moving average which suggests the potential start of a minor short-term uptrend phase for West Texas Oil.

Watch the US$80.90 key short-term pivotal support to see the next intermediate resistance coming in at US$83.00 before a retest on the 10 August 2023 swing high of US$84.90.

However, a break below US$80.90 negates the bearish tone to expose the US$79.55/79.10 support.

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Kelvin Wong

Kelvin Wong

Senior Market Analyst, Asia Pacific at OANDA
Based in Singapore, Kelvin Wong is a well-established senior global macro strategist with over 15 years of experience trading and providing market research on foreign exchange, stock markets, and commodities. Passionate about connecting the dots in the financial markets and sharing perspectives around trading and investment, Kelvin Wong is an expert in using a unique combination of fundamental and technical analyses, specializing in Elliott Wave and fund flow positioning, to pinpoint key reversal levels in the financial markets. In addition, over the last ten years, Kelvin has conducted numerous market outlook and trading-related seminars, as well as technical analysis training courses, for thousands of retail traders.