USOil Prepares for a Bearish Wave Following Rejection From Daily Order Block

Market Analysis – July 20

USOil is signaling the potential onset of a new bearish wave after being rejected at a significant daily order block resistance zone. This rejection follows a major structural break, indicating that the previous bullish retracement was merely corrective. With bearish confluences appearing across several timeframes, market sentiment has shifted decisively toward the downside, pointing to a likely continuation of the bearish move.

USOil Key Levels

Demand Levels: 64.00, 55.80, 48.50
Supply Levels: 72.20, 80.70, 88.00

USOil Long-Term Trend: Bearish

The long-term bearish trend was confirmed when price broke below the key low established in September 2024, breaching the $64.00 demand level and descending toward $55.80. This decisive break in structure shifted the broader trend clearly in favor of the bears. After this decline, price began a bullish retracement that extended slightly beyond $72.20, reaching into a clearly defined daily order block.

The reaction from this order block was sharp and immediate, pushing price back downward. Concurrently, the daily Relative Strength Index (RSI) entered overbought territory, indicating exhaustion in the upward correction. With price now trading beneath the daily Moving Average and RSI turning lower again, momentum has realigned with the prevailing bearish trend. These signals suggest that the retracement has likely ended, and the next bearish leg is unfolding—a development closely monitored by traders using forex signals.

USOil Short-Term Trend: Bearish

On the 4-hour chart, the market structure reinforces the bearish outlook. After rejecting the daily order block, price staged a brief bullish retracement that evolved into a bearish flag pattern. The subsequent breakout from the flag confirms the return of bearish momentum, further validated by the formation of lower highs and a declining short-term RSI. As long as price remains below the order block and continues setting lower highs, the short-term trend is expected to stay firmly bearish.

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