- September 14, 2018
- Posted by: admin
- Category: Forexlive Breaking news
WTI crude oil spot prices are consolidating, yet two interesting patterns are forming and they converge around the same point on September 4 high of $71.46, with a break to this high potentially sending prices higher.
First, as seen on the chart below the price is consolidating into a large triangle if we connect the July 10 high of $74.63 with the September 12 high of $71.29 with a downward sloping trendline, and the June 15 low of $63.58 and the August low of $64.46 with an upward sloping trendline.
The large triangle suggests that prices may continue to trade sideways for a few more weeks, and it also suggests that a break to the September 4 high of $71.46 could send prices to $79.46.
The second interesting observation is a potential inverse head and shoulders pattern made up by the August 2 and 15 lows, and the September 7 low, these three lows make up the left shoulder, head, and right shoulder. The neckline goes via the July 27 and September 4 high and is currently around the September 4 high of $71.42. If this pattern is completed, the price might be able to reach $77.99 level.
Evidently, from a technical point of view, the $71.46 level is important to watch as it could trigger a strong rally in crude oil prices. However, until a break occurs trading in crude oil is anticipated to remain rangebound.
A potential trigger could be Hurricane Florence. The state’s emergency services reported that up to 500,000 homes and business in North Carolina are without power and that more than a quarter of a million have fled the path of the storm. Earlier in the week, Florence was a category four storm, but it is now a category one storm, yet a high volume of rainfall and storm surges still risk to hurt human life and property.
WTI Crude Oil: Daily Candle Chart