High-impact economic releases, including US CPI, PPI, unemployment claims, and crude inventories, along with New Zealand’s rate decision and UK GDP, could shape oil market sentiment in the days ahead.
Crude oil remains in a firm downtrend after peaking at $79.30 in January. A Bearish Harami pattern and a “Death Cross” have confirmed the bearish shift, with momentum indicators reinforcing downside pressure.
Fundamentally, US crude has dropped to a four-year low at $56.32 as escalating U.S.-China trade tensions and rising OPEC+ supply weigh on the market. Unless key resistance levels are reclaimed, the bearish outlook remains intact, with further downside risk if support levels fail to hold.
High Impact Economic Events
Wednesday 05:00 am (GMT+3) – New Zealand: Official Cash Rate (NZD)
Since peaking at 79.30 on January 15, crude oil has entered a well-defined downtrend, marked by a consistent pattern of lower highs and lower lows—a classic signal of sustained bearish momentum. The initial indication of trend exhaustion emerged with the appearance of a Bearish Harami candlestick formation, typically associated with weakening demand and the potential for reversal. This development confirmed the end of the preceding uptrend and initiated a shift in market structure toward a bearish phase.
Adding to the technical confirmation, a “Death Cross” was subsequently observed, as the 20-period Exponential Moving Average (EMA) crossed below the 50-period EMA. This crossover reinforced the downside bias and suggested a deepening of the bearish sentiment.
Momentum indicators continue to support this negative outlook. The Momentum Oscillator remains below the 100 level, indicating persistent downside pressure, while the Relative Strength Index (RSI) holds beneath the 50 mark—reflecting sustained selling interest. Taken together, these signals underscore an environment in which downside risks remain dominant unless price action can reclaim key resistance thresholds to challenge the prevailing trend.
Key Resistance Levels
Should the buyers take market control, traders may direct their attention toward the four potential resistance levels below:
61.74: The initial resistance level is established at 61.74, which mirrors the 23.6% Fibonacci Retracement between the high point, 79.30, and the low point, 56.32.
64.92: The second price target is set at 64.92, reflecting the trough from March 5.
69.08: The third price objective is observed at 69.08, corresponding to the weekly resistance, R1, estimated using the standard Pivot Points methodology.
71.86: An additional upside target is projected at 71.86, mirroring the peak from April 2.
Key Support Levels
Should the sellers maintain market control, traders may consider the four potential support levels listed below:
53.69: The initial support level is seen at 53.69, corresponding to the 261.8% Fibonacci Extension drawn from 69.42 to 71.86.
45.66: The second support level is estimated at 45.66, representing the weekly support, S3, calculated using the standard Pivot Points methodology.
42.46: The third support level is identified at 42.46, reflecting the 423.6% Fibonacci Extension drawn from 69.42 to 71.86.
33.42: An additional downside target is 33.42.
Fundamentals
US crude oil prices dropped to a four-year low, closing at $56.32 per barrel, as escalating trade tensions between the US and China rattled markets. The decline follows President Donald Trump’s announcement of steep new tariffs on Chinese imports, raising fears of a global economic slowdown. Brent crude also fell to $59.87. Analysts warn that a mix of recession concerns and rising OPEC+ supply is weighing heavily on sentiment. As the US prepares to raise tariffs to 104%, hopes for a diplomatic resolution remain uncertain.
Conclusion
Crude oil remains under sustained technical and fundamental pressure, with prices retreating to multi-year lows amid a combination of bearish chart patterns, weak momentum signals, and deteriorating macro conditions. As markets await key economic data this week, traders will be closely watching for any signs of a shift in sentiment. However, unless broader fundamentals improve or key resistance levels are reclaimed, the outlook remains tilted to the downside.
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