Momentum in the most recent rebound in crude oil isn’t looking strong enough to ensure a sustainable rally just yet. The implication is that the downward correction that started toward the end of September could still be in play. Oil has recovered from near quite strong converged support, including the 89-day moving average, slightly above the 200-day moving average, and the August low of 77.50.
Earlier last month, oil pulled back from stiff converged barriers, including the Ichimoku cloud on the weekly charts and the October high of 93.00. This resistance remains crucial – a break above this barrier is needed to confirm that the rebound from June isn’t just a dead-cat bounce.
