WTI Crude oil forms bullish engulfing candle

WTI crude oil has given upward sloping trendline breakdown on April 26, 2019 and thereafter mark the sequence of lower tops and lower bottoms. However, at present, WTI Crude oil forms bullish engulfing candle on a daily time frame. The bullish engulfing candlestick pattern is considered to be a bullish reversal pattern and usually occurs at the bottom of a downtrend.

The short and long-term trend is still bearish as it is trading below its weekly pivot and short-long term moving averages. Daily strength indicator RSI continues to remain flat, indicating the absence of strength. But momentum oscillator stochastic is scaling up, indicating upside momentum. Moreover, the Ichimoku chart on the 60-minute time frame is clearly giving a positive view as it closed above the KS and TS lines. Another important aspect is the TS line crossed under the KS line, which is also a bullish sign.

Going ahead, the short-term 8-days EMA is likely to act as immediate resistance which is currently quoting at US$54.42 level. In case the crude oil prices sustain above this level, there is a high probability that Wednesday’s low point of US$50.60 would become a temporary bottom for the WTI crude oil.