Crude Oil Technical Analysis – The bulls need to break this key resistance

Fundamental
Overview

Crude oil continues to
display a rangebound price action as it struggles to break above the key 72.00
resistance. The Trump’s victory might be seen as bearish in the short term for
fear of the tariffs and a potential slowdown in global growth as other countries retaliate.

It’s worth remembering that
in 2016, crude oil did fall initially on Trump’s victory but eventually rallied
for more than 20% in the following three months on higher global growth
expectations.

The red sweep should see
Trump focusing more on tax cuts and domestic issues which should eventually
lift global growth expectations. If we had a divided Congress, then his first
priority could have been indeed a trade war.

Moreover, we have also central
banks easing their monetary policies and that generally leads the manufacturing
cycle, which is likely to be supportive for the crude oil market.

Crude Oil
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that crude oil is struggling a lot breaking the key resistance around the 72.00 handle. The buyers
will want to see the price breaking higher to start targeting the major trendline
around the 78.00 handle. The sellers, on the other hand, will likely keep on
stepping in around the resistance to position for a drop into the 65.00 handle.

Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we have a range between the 72.00 resistance and the 69.50 support.
The sellers will want to see the price breaking lower to increase the bearish
bets into the 65.00 handle, while the buyers will likely step in around the
support to position for a rally back into the resistance.

Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we have a minor downward trendline defining the current bearish momentum.
The sellers will likely keep on leaning on it to push into new lows, while the
buyers will look for a break higher to increase the bullish bets into the resistance.
The red lines define the average daily range for today.

Upcoming
Catalysts

This week is a bit empty on the data front with the most important releases
scheduled for the latter part of the week. On Wednesday, we have the US CPI
report. On Thursday, we get the latest US Jobless Claims figures. On Friday, we
conclude the week with the US Retail Sales data.

This article was written by Giuseppe Dellamotta at www.forexlive.com.