Crude oil remains in a bearish retracement that may have further to fall. However, on Tuesday, it triggered a bullish reversal by surpassing Monday’s high of $70.52. The high for the day at the time of this writing was $71.27 and trading continues near the highs of the day. If the day ends with crude in the top third of the day’s trading range, there is a good chance it can test higher potential resistance levels. On Monday, a minor new retracement low of $70.52 was established.
Bearish Correction May Have More to Go
The price of crude oil dropped by $10.23, or 12.7%, from the January 15 high of $80.76. However, it remains in a downtrend with lower swing highs and lower swing lows. Moreover, last week ended at the lowest weekly closing price for crude in seven weeks. A bearish shooting star candlestick pattern formed for the week and the closing price of $70.95 was almost below the prior week’s low at $70.91. This indicates that downward pressure remains.
