Oil breaches resistance amid conflicting technical signals 24/2/2023

US crude oil futures prices reflected the expected bearish trend, in which we relied on trading to remain stable at the time of writing of the previous report, below the resistance level of 75.10, explaining that the price’s attempts to consolidate above 75.10 might lead oil prices to a temporary bullish tendency, aimed at retesting the previously broken support-into-resistance level of 75.90, recording the highest at 76.05 during the early morning trading of today’s session.

Technically, there is a discrepancy between the technical signals. We found the 50-day simple moving average, which is still an obstacle to the price from above, supporting the possibility of a return to the bearish path. On the other hand, the stochastic indicator is trying to gain more bullish momentum to push prices to recover.

With conflicting technical signals, we prefer to monitor the price behavior of oil to be facing one of the following scenarios:

To get an upward trend, we need to witness a clear and strong breach of the resistance level of 76.75, a catalyst that enhances the chances of an increase to visit 77.50.

The return of the downside track requires breaking the immediate support floor 74.55, to return oil to the downside track, with an initial target of 73.10.

Note: Today we are awaiting important economic data issued by the US economy’s “primary personal consumption expenditure,” We may witness a high fluctuation in prices at the time of the news release.

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.

S1: 74.55	R1: 76.75
S2: 73.10	R2: 77.50
S3: 72.40	R3: 78.90