WTI crude oil has been experiencing an upward trend for three consecutive days and Recovers from a multi-month low. The price of the commodity has rebounded from its lowest level since December 2021 and has reached $71.70, which is good news for the energy industry. The RSI (14) line has helped the black gold recover by rebounding from the oversold territory.
Despite the upward trend, there are several challenges that could hamper the growth of the energy industry. The bearish MACD signals and numerous upside hurdles, including the immediate resistance level of the 10-DMA, currently around $73.00, could make it difficult for WTI bulls to make progress.
Other factors hindering the progress of the energy industry include a downward-sloping trend line from mid-April and the 21-DMA, which is currently located near $73.90 and $76.85, respectively. These could limit any further growth in the commodity price. However, if the WTI benchmark remains steady and goes beyond 21-DMA, the support-turned-resistance line from December 2022, close to $77.40, could act as the last defence of the WTI bears.
The 23.6% Fibonacci retracement level of the commodity's downside from November 2022 to the last week's bottom, near $71.00, could limit any short-term declines in the WTI crude oil price. If the quote remains weak past $71.00, the $70.00 round figure and $68.00 could act as support levels before directing them to the latest multi-month low of around $64.30.
WTI crude oil's recent recovery is encouraging, but the path to the north appears long and bumpy. The bearish MACD signals, multiple upside hurdles, and other factors, including moving averages and trend lines, pose significant challenges to energy buyers. It remains to be seen whether WTI crude oil can maintain its upward trend and overcome these obstacles.
The recovery of WTI crude oil is good news for the forex market, particularly for countries that are heavily reliant on the commodity. Forex traders often monitor oil prices, as they can have a significant impact on the exchange rate of oil-producing countries. The increase in oil prices could also have an impact on inflation rates, which could lead to changes in central bank policies, ultimately affecting forex trading. It is important for forex traders to closely monitor the trends in the energy industry and be aware of any potential challenges or opportunities that may arise.