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Crude oil is hanging out at the very top of its falling wedge pattern!

Will resistance hold again or is the commodity in for a breakout soon?

WTI Crude Oil (USOIL): 4-hour

WTI Crude Oil (USOIL) 4-hour Chart

WTI Crude Oil (USOIL) 4-hour Chart

Heads up, crude oil bears!

The commodity is testing its rising wedge resistance, and I’m seeing what appears to be a doji candlestick suggesting a turnaround.

If we do get confirmation from the next candles, price could be in for another move back to the wedge support near the $75 per barrel mark.

Technical indicators are also pointing to a continuation of the slide, as the 100 SMA is below the 200 SMA while Stochastic is indicating overbought conditions.

These basically mean that bearish vibes are present and might even get stronger soon!

However, if crude oil buyers refuse to let up, price could still bust through the top of the wedge and make its way up to the next resistance levels. Watch out for nearby upside barriers around the moving averages if you’re planning on going long.

Earlier this week, the EIA reported a surprise 0.2 million barrel draw in crude oil stockpiles, following the previous build of 1.1 million barrels. Analysts had projected an increase of 2.0 million barrels, so the reduction could be indicative of a pickup in demand.

Output is also expected to take a hit in the coming days, as Hurricane Ian would probably limit crude oil production in the Gulf of Mexico.

Apart from that, resurfacing geopolitical tensions from Russia might also keep investors on the lookout for another energy crunch.

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