FxWirePro: WTI crude’s bullish engulfing pattern struggles for momentum, short hedge as bearish engulfing retraces more than 61.8% Fibos

Crude oil price has momentarily halted its bearish streaks from the recent past, at 1 and a half year low as the energy commodity (WTI crude) price tumbled this month to $42.40 levels but recovered to the current $46.18 levels. 

Well, before proceeding further, let’s just quickly glance through below weblink where we advocated short hedges in the past:

https://www.econotimes.com/FxWirePro-WTI-Crude-Edgy-at-50-Fibos-on-Shooting-Stars-Trade-Tunnel-Spreads-and-Short-Hedge-1444241

After looking at this post, you may now understand that you would have considerably saved your crude exposures by now, had you deployed those WTI futures positions (when crude was trading at $71.35 levels) and rest is history.

Technically, on WTI crude price chart, bullish engulfing pattern has occurred at $46.57 levels, consequently, the recent rallies attempted to bounce above 7DMAs but were restrained below these levels (refer daily chart). The minor trend appears to be weaker on the formation of back-to-back shooting stars at $52.58 and $52.91 levels, for now, more slumps seem to be on cards amid mild rallies.

On a broader perspective, although we see some minor rallies, more dips seem to be on cards upon breach below major Fibonacci levels that acted as the strong supports as both the leading & lagging indicators signal weakness (monthly plotting).

Please be noted that on monthly terms also, steep slumps well below EMAs upon bearish engulfing patterns at $64.83 levels, ever since then, bears have managed to constantly nudge prices below EMAs and retraces more than 61.8% Fibonacci levels are observed. More weakness is foreseen on this timeframe as well as both leading oscillators (RSI & stochastic curves) indicate faded strength & intensified bearish momentum and lagging indicators (EMA & MACD) signal downtrend continuation.

Currently, at spot reference: $46.41 levels, as the market tone is troublesome, we note that the continued decline in crude oil with WTI testing fresh lows and threatening $45/bbl also makes the commodity-driven currencies vulnerable, we wish to uphold WTI short futures positions for arresting further downside risks.

Currency Strength Index: FxWirePro's hourly USD is inching at 37 (which is mildly bullish), while articulating (at 12:17 GMT). 

For more details on the index, please refer below weblink: http://www.fxwirepro.com/currencyindex