WTI Crude Oil found support at 98.75 in the beginning of May and has been bullish throughout the month.
After finding resistance at 104.50 last week, WTI Crude consolidated between 103.50 and 104.50. During the 5/28 session, price action formed a top in the 4H chart, and broke below a rising trendline seen in the 4H chart.
The 4H RSI also tagged 30, which shows not only a loss of bullish momentum, but possible start of bearish momentum. If there is a pullback during the 5/29 session and price stays south of 104 (central pivot of the 103.50-104.50 range), the bearish outlook will look even more attractive.
What context does this bearish outlook have in the broader view/higher time-frame?
The daily chart shows oil prices in a triangle formation since it tagged 105.00 in March. Note that there is no persistent bullish trend before the triangle (just a bullish swing), there is no strong bullish bias. In fact, before the bullish, swing there was a bearish swing from Nov. to Dec. 2013.
Given the neutral condition, we still should limit the bearish outlook to the triangle support. There is a pivot at 100.76, so the 100.80-101 area should come in focus if the price top seen in the 4H chart is respected.
A break above 105 will be needed to open up a bullish continuation scenario that opens up the 110-111 area.
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