Oil Analysis: WTI Approaches the $60 Level Again

Over the past two trading sessions, oil has gained more than 4.5%, and is once again approaching the psychological barrier of $60 per barrel. This recent bullish movement persists despite OPEC+’s clear stance on increasing supply in June and the International Energy Agency’s (IEA) cautious outlook on global oil demand for the remainder of the year. As such, it appears that oil prices are currently benefiting from improving market sentiment, particularly as investors await the outcome of the upcoming U.S.–China trade negotiations.

Persistent Bearish Trend
Since mid-January, oil has maintained a steady downtrend, and so far, minor bullish retracements have not been strong enough to signal a meaningful reversal. Therefore, this downward technical formation remains the dominant structure to monitor in upcoming trading sessions.

RSI
The Relative Strength Index (RSI) continues to hover around the 50 level, indicating a sustained balance between bullish and bearish momentum. As long as this equilibrium remains, a neutral bias could dominate short-term price movements.

ADX
The Average Directional Index (ADX) remains close to the 40 mark, though the line has recently begun to flatten. This could be interpreted as a sign of weakening trend strength in the short term, likely due to the price currently testing a significant resistance zone.

Key Levels to Watch:

• $60 – Nearby resistance: A short-term psychological level. A break above this zone could reactivate a bullish bias and potentially lead to the formation of a new short-term uptrend.
  
  
• $63 – Main resistance: Aligned with the 50-period moving average. Sustained price action above this level could challenge the prevailing long-term bearish structure.
  
  
• $57 – Nearby support: A zone that matches recent multi-week lows. A drop below this level could reinforce bearish momentum and provide more room for the current downtrend to extend.
  
  

Written by Julian Pineda, CFA – Market Analyst