Premium analysis by our dedicated team
Nov 15, 2021, 2:12 PM GMT

Crude Oil Attempting a New Downtrend

The price action of crude oil appears to be in the early stages of establishing a new bearish trend, as it attempts to break down below the lower boundary of a major consolidation range. This range serves as a Distribution of a broader Wyckoff Cycle, which means that the trend reversal if it is indeed to take place, would likely be marked by predictable behaviour of the price action.

And there are plenty of fundamental factors to consider that seem to be congruent with the expectations for a decisive trend reversal. British economic activity was staved off in the third quarter, underpinning diminished demand. This could exacerbate crudes struggles in the short term.

Meanwhile, the anticipated uptick in U.S. consumption this week is mostly owing to persisting supply bottlenecks worldwide, which does not really signify heightened energy demand. Both factors are therefore likely to highlight a possible selloff in the price of crude oil.

However, despite all of these selling indications, bears should be careful where they decide to join the currently emerging downtrend. That is so because the market's transition from one state into another is typically typified by heightened adverse volatility, which could be detrimental to poorly executed orders.

Profit & Loss
Short Term Long Term Net % Gains
+ - + -
4.44 USD 0.50 USD Pending Pending
Short Term
+ -
4.44 USD 0.50 USD
Long Term
+ -
Pending Pending
Net % Gains

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