USOil (WTI) Resumes Bearish Trend After Reaccumulation

Market Analysis – June 10

The USOil market has resumed its bearish trend following a period of reaccumulation. This bearish trend was initiated with a head-and-shoulders reversal pattern. After breaking below the key level of 81.10, the price entered a consolidation phase, which has now been followed by a bearish breakout, continuing the downward trajectory.

USOil Key Levels

• Demand Levels: 72.40, 69.10, 60.00
• Supply Levels: 81.00, 87.50, 94.50

USOil Long-term Trend: Bearish

The USOil price ascended using the bullish trendline, reaching 87.50. However, after hitting this resistance zone, the price fell below the midline within the Bollinger Bands, indicating weakness. The subsequent break of the bullish trendline confirmed a shift in market direction.

The new bearish trend was reinforced with a break below the support level 81.00. This move led to the formation of a range characterized by higher highs and lower lows, creating an expanding range known as a megaphone pattern or broadening formation. This pattern typically indicates increasing volatility and uncertainty, often preceding significant price movements.

USOil Short-term Trend: Bearish

Before resuming the bearish trend, a Judas pattern emerged. The price initially broke out to the upside, deceiving breakout traders, only to make an impulsive move to the downside, triggering stop-loss orders. This deceptive move often catches traders off guard, leading to a more pronounced sell-off. The price has since pulled back to the mitigation block at 76.90, providing an opportunity for optimal short-order entries common in the best forex signals. This level is crucial, as it offers a favourable risk-to-reward ratio for traders looking to capitalize on the bearish continuation.

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