Recently, one of the interesting charts that I came across is that of Crude Oil. If you’re paying attention to the Energy segment, it’s obvious to see Oil prices crashing from last couple of weeks because of Coronavirus pandemic. If you place the Falling prices in the context of big picture, we can notice something significant is going on in Crude Oil. To get an idea of what I mean, take a look at this higher time Frame Price Action Analysis.
Crude Oil – Trading Near Historically Significant Support Zone
More volatility in the market means more trading opportunities; at least that’s the case with Crude Oil. What you see above is the 1 month time frame chart of Crude Oil. Right now, prices are trading near the long-standing and historically significant support zone at 1800.
In the past, several times prices have bounced back and rallied higher from this level. All significant price crashes such as 2008 Global Financial Crises and 2013 US Shale Oil Supply glut etc. ended at the Support zone. Right now what we see is nothing but another price crash that started because of stagnating Economic growth and Coronavirus Pandemic.
Just like the past, Will the prices bounce back once again from the support zone? Or is it going to break the support zone and continue further to the downside? Will the History repeats itself or is it going to be different this time? In either case, whatever happens will be important to determine the direction of Oil Prices in coming months. Traders must closely observe the Price Action and should take trades according to the market behavior. It’ll be interesting to watch Crude Oil in coming days.
