Technical Analysis: USOIL

USOIL reached a 6-week low

USOIL continued to fall due to concerns on global economic recession. On Wednesday, USOIL plunged by around 5% to a 6-week low.

Northern Iraq may resume oil exports

Iraq Petroleum Company is expected to reach an agreement with KRG that Northern Iraq will resume oil exports within two weeks, the market said.

The interest rate increase intensified debt load

On 3^rd May, the Fed announced the interest rate increase to curb the inflation, which will intensify the debt load of consumers and companies. In addition, economists expressed their concern that this move may trigger economic slowdown or economic recession.

Technically speaking, the market trend is bearish

the chart of the day

On the chart of the day, USOIL was prone to fluctuation and declined. The market trend is bearish in the short term. In terms of technical indicators, MACD went downwards after death cross occurred at high levels, showing the market trend is bearish. USOIL will dip further if it breaks below the support at 63.8.

4-hour chart

On the 4-hour chart, USOIL remained low and began to rebound. The market trend is generally bearish. In terms of technical indicators, RSI remained low, showing the market trend is bearish. USOIL will fall further if it rebounds but is capped at 71.6.

Key resistance: 71.6, 74.0

Key support: 66.3, 63.8

Generally speaking, concerns on economic recession put pressure on oil price. In addition, as Northern Iraq may resume oil exports, there is a risk that USOIL will fall further in the short term. Investors should focus on US economic data during the day.