USOil Sluggishly Makes Progress

Market Analysis – December 27

The USOil market has been in a prolonged consolidation phase, fluctuating between the resistance and support levels around 72.430. During this consolidation, a descending triangle pattern emerged, which eventually led to a bullish breakout. Following the breakout, the market retraced to retest the descending triangle, which has since provided a stable foundation for further upward movement in price.

USOil Key Levels

Demand Levels: 67.190, 62.540, 57.920
Supply Levels: 72.430, 78.420, 83.290

USOil Long-Term Trend: Ranging

The support level of 67.190 has proven to be a stronghold on the daily chart. The Stochastic indicator repeatedly dips into the oversold region during each rebound off this key level. Within this consolidation, lower highs have formed above the consistent lows of 67.190, eventually culminating in a breakout from the descending triangle pattern.

The pullback to retest the descending trendline of the triangle after the breakout has resulted in bullish daily candles, signaling the market’s response to this support. The price is now approaching the resistance level of 72.430, with bullish momentum gradually building.

USOil Short-Term Trend: Bullish

On the lower time frame, a clear double bottom pattern has formed during the retest of the descending triangle following the breakout. This pattern confirms the likelihood of a bullish continuation. Although the price movement appears gradual on the daily chart, WTI is steadily building a bullish structure and making incremental gains, aligning with forex signals that indicate a potential sustained upward trend.

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