Technical Analysis – Oil taps a major trend line

The price of oil has been in a strong upward trend since May 2020, when it reached its bottom during the early stages of covid 19 pandemic, and the price of oil reached close to $0. The price of oil has respected the trend over the long term and has now retested the trend for the third time.

As seen above, oil has failed to break below the trend line, showing strong signs of a potential continuation of its bigger picture up trend.

Oil is also currently sitting on a major support level between $84 and $85 (yellow highlighted zone), paired with the higher time frame uptrend as well as the trend line show the potential of a continuation to the upside. If there is a strong bearish weekly candlestick that breaks and closes below the support zone, then considerations for potential downside needs to be taken into account.