Oil is facing an interesting choice right now.
After OPEC’s agreement to cut supply, the demand for Oil picked up and the price went up as well.
With the technicals making a coiling triangle pattern, the news has seen price rally to resistance where we have seen our first pause since the announcement.
On the daily chart, we can see that while it might look like price has broken out of the triangle, the fact that price has been unable to break the horizontal resistance level just 100 pips above is something to be worried about for Oil bulls.
Anywhere you see a confluence of support/resistance like this, it is worth taking notice of.
OIL 4 hours
Zooming into an intraday chart and price looks even more bearish again, highlighted by a possible head and shoulders setup forming. Now I’m not the biggest fan of these types of subjective setups, but being at a higher time frame resistance level, this one really jumped out at me.
Technical analysis is a self-fulfilling prophecy after all!
This is a guest post originally appeared on Vantage FX. Reposted with permission.