Hey Valutraders! Are we still bearish on Oil? Let’s take a look!
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I’m Brad Alexander and in this week’s Market Blast Technicals let's take a look at USDJPY, Natural Gas (NatGas), Gold (XAUUSD), and WTI (USOil).
Let’s face it…fundamental events are still driving the price of Crude Oil with supply vs demand and potential price caps, but we see price action heading for this upper trend line in a downward trend.
Also, the Stochastic Oscillator has just entered Overbought territory so we will keep an eye on this.
If you are a fan of MACD you can see that it has spent most of its time below zero (0).
The view from the Daily chart confirms the bearish trend and the bearish look at the MACD as well.
Last week we spotted this Rising Wedge on Gold and we hope you were paying attention as the bearish pattern worked out and price action fell.
If you often wonder, when is the best time to go short out of a bearish pattern, we had lots of clues here on the 1-hour chart.
Price action formed a Double Top, the good US CPI numbers drove price action lower, and the Stochastic Oscillator was already in Overbought territory.
The safe trade was to wait until price action broke through the neckline with a stop loss above the Double Top.
The fundamentals on Natural Gas are more optimistic than before with major economies like Germany storing enough for a cold winter but supply out of Russia is still uncertain.
From the technical standpoint, we see price action testing this key level of support at $7.60 with a small pullback today with the Stochastic Oscillator looking Overbought.
If we move out to the daily chart, we can see a Head & Shoulders with the neckline at $7.60 so we need to see a break below before going short.
Last week we spotted a Symmetrical Pennant on USDJPY and the good US CPI numbers broke it.
Here is another larger one but don’t forget, that both the US Fed and the Bank of Japan will be announcing Interest Rate decisions this week so be careful.
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