Crude Oil Tests Long Term Support
This month’s banking crisis dragged many cyclical assets lower as investors worried about a possible recession. Today’s weekly chart considers the impact on crude oil futures.
The first pattern with potential relevance is the $65 price area. CL1! bounced at this level in mid-2018 before breaking lower. Crude peaked there again in 2019 and early 2020 – shortly before the coronavirus crash.
Energy prices chopped on either side of $65 the following year. They importantly bottomed there in December 2021 before starting a dramatic run toward $120.
As a result, some traders may have noticed when CL1! revisited that level last week and started climbing from it this week.
Next, the current price zone is also near the 200-week simple moving average (SMA).
Finally, this week’s low was almost exactly half the March 2022 high of $130.50. That simple 50 percent drop could satisfy some buyers demanding a healthy discount.
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TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
The first pattern with potential relevance is the $65 price area. CL1! bounced at this level in mid-2018 before breaking lower. Crude peaked there again in 2019 and early 2020 – shortly before the coronavirus crash.
Energy prices chopped on either side of $65 the following year. They importantly bottomed there in December 2021 before starting a dramatic run toward $120.
As a result, some traders may have noticed when CL1! revisited that level last week and started climbing from it this week.
Next, the current price zone is also near the 200-week simple moving average (SMA).
Finally, this week’s low was almost exactly half the March 2022 high of $130.50. That simple 50 percent drop could satisfy some buyers demanding a healthy discount.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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