Crude is likely to come under further pressure, according to David Linton, Chief Executive at Updata.
Linton says crude has not managed to get above the cloud on ichimoku charts for several months and the medium-term outlook remains bearish. Brent Crude has even moved back below the cloud on the shorter-term 60 minute chart.
Adding more weight, Linton points out that the traditional correlation between oil and the USD is back in play and as the USD rises, oil falls. As such, he says, “On most grounds, the price [of crude] looks like it’s going to come under pressure.”
For light crude, this means that the significant $40 psychological level will likely be tested and his point-and-figure charts are suggesting downside targets of 39.30 and 37.35.
For details, watch Updata’s Technical Analysis for Energy Traders, which includes an analysis of the major energy, currency and stock markets:
Crude Oil US
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