WTI Oil Technical Analysis: Pullback likely before a convincing break above 50-day MA

WTI oil is currently trading just above the 50-day moving average (MA) of $52.60.

A price pullback could be in the offing before a convincing breakout above the MA, as the RSI on the 4-hour chart is reporting overbought conditions, validating the indecision or bullish exhaustion signaled by yesterday’s doji candle.

4-hour chart

• The RSI on the 4-hour chart is hovering above 70.00 in overbought territory. More importantly, the latest higher high on price is not confirmed by the indicator, that is a bearish divergence could be in the offing. 

Daily chart

• The bearish view put forward by the downward sloping 50-day MA would be reinforced if prices confirm a bear doji reversal with a close below $51.39.  That could yield a test of demand below the psychological level of $50.00.
• A close above $52.75 would signal bullish continuation.

Trend: Pullback likely