Charts Of The Day: Oil under pressure

Market Analysis / 4 Min Read
Milan Cutkovic / 06 May 2021

Highlights:

  • Oil prices have come under pressure – and it looks like a healthy pullback following a sudden surge, rather than the beginning of a correction
  • GER30 bounced back after Tuesday´s sharp sell-off, breaking above a major resistance level – but can it sustain momentum?
  • JPN225 picks up momentum, but traders are waiting to see if gains can be sustained above a psychologically important support level
  • After a small retracement, coffee prices jumped to a new multi-year high
  • GBP/USD is consolidating within a triangle pattern, but a breakout appears imminent

Oil Markets

Oil prices have come under pressure in the past 24 hours and it looks like a healthy pullback following a sudden surge, rather than the beginning of a correction. USOIL is consolidating around the $65.35 support level. A daily close below this level could indicate that we might see a test of the key $64.22-36 support zone in the near-term. With the uptrend intact, buying interest is likely to pick up as USOIL approaches this area of support. To the topside, $66.70 is the next hurdle for Oil bulls, after which there is no significant resistance until the 2021 high at $68.

GER30

The GER30 bounced back after Tuesday´s sharp sell-off and broke above the major resistance level at 15,080 points, but whether the index can sustain the momentum remains to be seen. Traders will be keeping a close eye on the falling trendline from the April high, as well as the resistance level at 15,280 points. A clear break above it could pave the way for a continuation of the recovery rally. However, should GER30 fall back below the 15,080 level, it would confirm the false breakout and signal a deeper correction.

JPN225

JPN225 recently saw a symmetrical triangle breakout to the upside. The index has picked up momentum, but traders are waiting to see whether JPN225 will be able to sustain gains above the psychologically important support level at 29,000 points. A clear breakout could pave the way for a rally towards 29,523 points, where heavier resistance can be expected. Overall, the uptrend remains intact, but the stock market´s wild mood swings in the past few days have had an impact.

 

Coffee

 

After a small retracement, Coffee prices jumped to a new multi-year high today. The charts are hinting at overbought conditions in the short-term, but the uptrend remains strong and traders are keen to buy the dips rather than go against it. To the downside, imminent support is seen at $147.36, followed by $139.51.

What has been pushing Coffee prices higher? Demand has been stable throughout the pandemic, but at the same time there have been supply chain disruptions and a drought in Brazil that impacted the country´s coffee production.

 

GBP/USD

 

The information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.

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