In the early Asian session, the Crude Oil #CL is trading above the 21 SMA and above the +1/8 murray, showing a bullish bias. Although it is approaching the extremely overbought zone, a downward correction is likely in the next few hours.
The level of 71.30 acts as immediate resistance, and higher high is located +2/8 of murray at 71.88 (the extreme overbought zone). Both levels will be the resistances that Crude Oil must face in the next few hours.
A consolidation below 71.30 will be a good opportunity to sell in the technical correction to the bottom of the bullish channel line at 69.80 and the break of the bullish channel could push further down to 8/8 murray in 68.75.
OPEC Secretary General Mohammad Barkindo said: The market has continued to react positively to the decisions we made from May this year, including upward adjustments to production levels. OPEC expects oil reserves to fall further in the coming months.
Undoubtedly this comment has given Crude Oil a bullish outlook and has prompted buyers to maintain their positions for a long time. However, this bubble could burst because according to technical analysis the eagle indicator is showing bearish divergence from several weeks. It is likely that in the coming days we will see a very strong correction to the area of 68 and 65 dollars per barrel.
As Crude Oil is approaching a key resistance level at the 71.30 area, our recommendation is to sell below this level, targeting the SMA of 21 located at 69.50.
The technical reading of the eagle indicator is showing a bearish signal, with the probability of an imminent correction of the Crude oil #CL in the coming days.
Support and Resistance Levels for June 14 – 15, 2021
Resistance (3) 71.13
Resistance (2) 71.88
Resistance (1) 71.49
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Support (1) 70.57
Support (2) 70.17
Support (3) 69.09
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Trading tip for Crude Oil #CL for June 14 - 15, 2021
Sell below 71.30 (Strong resistance), with take profit at 69.50 (SMA 21) and 68.75 (8/8), stop loss above 71.88.
The material has been provided by InstaForex Company - www.instaforex.com