The oil daily chart has moved from its weak area, between the lower blue and red bands, into its neutral zone, between the blue bands (vertical green rectangle). This activity is a relative movement towards strength.
This relative strength is reflected in the hourly chart too. The EMAs and the stochastic have both crossed positively (black ellipses). Moreover, if the stochastic makes it to its upper quintile and holds (blue arrow), a bullish swing will likely be underway.
The higher oil price comes as OPEC+, on Sunday, held their output targets steady as the EU placed a price cap and ban on Russian crude. Furthermore, over the weekend, China eased Covid-19 curbs in several cities, a positive sign for energy demand.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.