June 8 , 2018
The price of crude oil inches higher on Thursday as black gold is getting demand from an uptrend line. Initially crude was moving in an uptrend and was making successively higher highs and higher lows due to Venezuela concern but after arriving at $72.87 level it tumbled down to $64.26 where an uptrend line was lying. By applying the Fibonacci retracement line from $58.40 to $72.87 level we may see that it found support from 50% retracement line which is a strong support level.
Rising US oil output remain weighing on traders’ sentiment. The OPEC-member’s, Venezuela, exports continue to force on the back of falling output levels amidst the financial and economic crisis. Venezuela faces hurdles clearing 24 million barrels oil export backlog. Well overall trend is up and the recent downfall can be considered as correction or dip so in an uptrend market it is advised that buy on dips. It’s a perfect to initiate your buy position and traders & investors may add on their further long position once bulls trades and settles above $66 level. A valid breakout of $66 level will open the gate towards the $69 and $70 level.
The current candlestick is bullish engulfing which is full of bullish sentiments. The way bulls are dominating the bears it seems like this will touch the $70 level in very short term. Odds are in favor of bulls and we keep our bias bullish on the crude oil as long as $64 level remains intact.
The momentum oscillator is generating bullish signal from positive territory and Directional movement Index (DMI) is also supporting the bulls for the time being. The $70 level is immediate resistance level followed by $72 whereas $64 level is strong key support level followed by $62 level.
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