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In the previous technical report, we maintained an intraday neutral stance due to conflicting technical signals, coupled with trading confined within key trend boundaries. The lower boundary rested above 77.80, while the upper boundary lay below the extended resistance levels of 78.50-78.70.
Technically, gold prices remained ensnared between these levels, failing to breach the 78.70 resistance and currently hovering near the main support at 77.70. Upon closer examination of the 4-hour chart, the relative strength index indicates a neutral position.
Given this context, we opt to observe oil price behavior for a second consecutive session, anticipating one of the following scenarios to unfold:
- A sustained closure of at least an hour candle below the support floor of 77.70 would likely reignite the bearish scenario, with downward targets starting at 77.10 and 76.15, serving as the subsequent official stops.
- Conversely, a breakthrough upwards to the 78.70 resistance, representing the 23.60% Fibonacci correction level, could serve as a catalyst for oil prices to recover towards targets at 79.40 and 80.30.
It’s essential to note the potential high level of risk amidst ongoing geopolitical tensions, which may contribute to increased price volatility in the market.
By maintaining a neutral stance and outlining potential price movements based on technical analysis, this report provides valuable insights for investors navigating the oil market under prevailing market conditions and geopolitical uncertainties.
Note: Trading on CFDs involves risks. Therefore, all scenarios may be possible. This article is not a recommendation to buy or sell but rather an explanatory reading of the price movement on the chart.
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