WTI crude oil futures (October delivery) have been trading within a sharp ascending channel over the past two weeks in the 4-hour chart, creating a bullish correction after the rebound on the 2-month low of 64.40.
Currently, the oil is edging higher and remains above the 20- and 40-simple moving averages (SMAs), while the technical indicators are endorsing the scenario for a bullish tendency. The RSI indicator is approaching the overbought zone and the MACD is trying to surpass the trigger line in the positive zone.
The price is moving towards the next resistance level of 61.8% Fibonacci retracement level of the downleg from 75.24 to 64.40, around 71.10. If there is a successful close above this zone the market could run until the 72.30 high, taken from the top on July 11.
On the flip side, in case of a declining pressure and a drop below 70.40, the price could challenge the 50.0% Fibonacci of 69.80 before touching 69.50. A significant leg below it could change the short-term view from bullish to bearish and the price may hit the 38.2% Fibonacci near 68.53 as the oil would penetrate the upward sloping channel.
Overall, WTI crude continues the aggressive upside momentum in the near term, while any decisive close above the channel could turn the bullish outlook even brighter.
