On the daily chart below for
XTIUSD, we can see that after breaking out of the 3 month-long range, the
sellers piled in aggressively dragging the price to the $64 price zone. This is
where we got a bounce. The current rally may be due to the easing in fears
around the banking sector and better than expected economic data.
In fact, the selloff was caused
by the failure of the Silicon Valley Bank and the subsequent fear in the
markets that this may be another financial crisis or at least tip the economy
into a recession earlier than expected. The price has now pulled back to the
red long period moving
average and the broken support that now may turn into resistance. This is where the sellers will
start to pile in again targeting a new low.
On the 4 hour chart below, we can
see that the price got rejected near the 61.8% Fibonacci
retracement level and the daily red long period moving
average. The price is still within the resistance zone and the buyers will need
a break above the high and the 61.8% Fibonacci level to gain more conviction
and start targeting the top of the previous range at $82. The moving averages
on this timeframe are crossed to the upside and we may see the red long period
moving average act as support for the buyers.
On the 1 hour chart below, we can
see that on this timeframe the moving averages have crossed to the downside as
the selling momentum dominates. The sellers will need a break below the $72
level to extend the move to the trendline and beyond.
The buyers, on the other hand,
may lean on that same $72 level to start another rally. The only risk event
today is the US Jobless Claims and given that the market wants
to see confirmation that the recent events in the banking sector have slowed
the economy, a miss in the data should be bearish for oil while a beat may be
bullish.