In the early American session, Crude Oil, #CL, is trading in 4-hour charts above the SMA of 21 and below the +1/8 of murray. This level coincides with the psychological level of 70.00. A bearish movement is expected in the next few hours due to the divergence of the eagle indicator.
The revival in the oil production and growing energy demand have led crude to trading at levels of 69.80, approaching extremely overbought levels. Given that the market has been bullish for several weeks, it is expected that below 70.00 there will be a sustained correction to the 200 EMA level to 65.32.
On the other hand, OPEC and its allies expect oil inventories to decline further in the coming months, the OPEC secretary general said on Monday, suggesting that efforts by producers to support the market are succeeding.
In view of the optimism of large companies, technically we expect that crude oil will make a correction for a new bullish momentum. At this level, investors are expected to take profits, it is also not a good business to buy at these levels. If you look at the chart, the last candles are showing consolidation and forming fractals that is a sign of exhaustion of the bullish force.
As the eagle indicator is showing a negative divergence, a downward movement could occur below 69.70, also #CL crude has left a Pin bar candle, which means that the markets are facing a probable correction in the next few hours.
Our recommendation is to sell below 69.70, at current price levels. If there is a pullback to the 70.31 zone of +1/8 murray zone, we can sell in this zone with targets in 8/8 of murray zone of 68.75 and a break of this level could fall to 67.19.
Support and Resistance Levels for June 07 – 08, 2021
Resistance (3) 71.27
Resistance (2) 70.63
Resistance (1) 69.99
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Support (1) 69.09
Support (2) 68.57
Support (3) 67.73
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Trading tip for Crude Oil (#CL) for June 07 - 08, 2021
Sell below 69.70 or sell if pullback 70.30 (+1/8 of murray), with take profit at and 68.75 (8/8) and 67.19 (7/8), stop loss above 70.00 and 70.65.
The material has been provided by InstaForex Company - www.instaforex.com