In this process of the Bull Run, WTI crude prices have managed to hit 3 years highs, gravestone has occurred exactly at the resistance of $63.52 levels to counter these rallies (refer monthly chart). But bulls have shrugged off this indication to extend this pattern.
But for today, the prices have dipped below 7DMAs after the failure swings at the highs of $64.86 levels, both leading oscillators have been slightly indecisive and signaling overbought pressures.
But on the contrary, let’s have a glance through the major trend that was now has gone into consolidation phase that was jerky way back in mid-2015. From massive slumps from the peaks of $114 levels shouldn’t be disregarded and jumping to conclude this as a robust uptrend would be unwise, it is just 38.2% retracements.
More rallies on the cards upto next major resistance at $70.18 levels upon crossover (7EMA crosses over 21EMA).
Major supports are observed at $60 levels.
While both leading oscillators ( & curves) on monthly terms have been converging upwards that signal strength in the prevailing uptrend.
Hence, we’ve already advocated adding longs using contracts of near-month tenors with a view to arresting upside risks, we reiterate that it is wise to use dips to deploy long hedges using these WTI derivative contracts but using mid-month tenors as well.