Chart: WTI Crude Oil (USOIL) Bounce Resistance Triangle

Are the crude oil bears about to stay in the game for much longer?

A look at the energy commodity’s daily time frame shows a large descending triangle pattern that has been holding since last November.

WTI Crude Oil (USOIL) Daily Chart by TradingView

Earlier this week, we looked at a possible break-and-retest setup on the 4-hour crude oil chart as geopolitical tensions in the Middle East worsened and fueled global supply concerns.

However, the spotlight has just shifted back to a weaker demand outlook as the latest API and EIA inventory figures reflected larger-than-expected inventory increases.

Are negative pressures about to rise from here?

Remember that directional biases and market price volatility conditions are usually driven by fundamentals. If you haven’t done your homework on crude oil and the US dollar yet, then it’s time to check the economic calendar and catch up on the daily fundamentals!

The 100 SMA has just crossed below the 200 SMA on this longer-term time frame, suggesting that the odds are changing in favor of the sellers. These moving averages also line up with the top of the triangle, which just recently kept crude oil gains in check.

With that, watch out for a sustained bearish momentum that could pull prices back to the triangle support at $68 per barrel, close to the pivot point level ($69.30 per barrel).

Just remember that all the attention on the Fed’s rate cut prospects could still allow US inflation data to affect overall market sentiment and commodity price action. An increase in risk flows or anti-USD trends could yet trigger a bullish triangle breakout above R2 ($72.38/barrel) which could take crude oil to its next bullish targets!

Whichever bias you end up trading, remember to practice proper risk management and be aware of top market catalysts when trading it.