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WTI Crude Oil To Slip Again?

 
WTI crude oil, petroleum, ron acoba, rising wedge, hidden bearish divergence, commodities trading, energy and fuel

WTI crude oil suffered an unprecedented fall last week when it was dropped like it was hot from a high of $114.81 per barrel to a low of $94.65 in a matter of days. Since then oil prices have rebounded again. However, it appears that oil could bound for another dip in the near term.

As you can see from its 4-hour chart above, WTI crude oil looks to have formed a rising wedge pattern in its recent run-up. Technicians consider this this pattern as bearish since it generally just indicate a temporary rally in prices following a deeper descent. Notice also that is is already nearing the 50% Fibonacci retracement level, using its last high at $114.81 and the low of $94.65 as swing points. Additionally, the presence of a hidden bearish divergence, where the price makes lower highs and at the same time its stochastics register higher highs, suggests of a possible downbeat turnaround soon. Moreover, crude oil’s condition appears to be already overbought as indicated in its stochastics. A breakdown, therefore, from the rising wedge pattern could sent it back to its recent low.

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