Crude oil price rebound evolves into bull flag formation
The price of oil appears to be trading in a narrow range as it bounces along the 50-Day SMA ($87.54), but crude may attempt to retrace the decline from the monthly high ($93.64) as a bull-flag formation appears to be taking shape.
Technical forecast for oil price: bullish
The price of oil snaps the recent series of lower highs and lows despite trading to a fresh weekly low ($85.20), and the continuation pattern may unfold over the coming days as crude no longer responds to the negative slope in the moving average.
The bull-flag formation is likely to stay in play as long as the price of oil retains the advance from the monthly low ($80.87), with a break/close above the $90.60 (100% expansion) to $91.60 (100% expansion) region bringing the monthly high ($93.64) back on the radar.
Next area of interest comes in around $93.50 (61.8% retracement) to $95.30 (23.6% expansion), with a move above the 200-Day SMA ($97.34) opening up the $100.20 (38.2% expansion) area.
However, the price of oil may threaten the opening range for October if it struggles to hold above the $84.20 (78.6% expansion) to $84.60 (78.6% expansion) region, with a break below the monthly low ($80.87) bringing the $78.50 (61.8% expansion) to $79.80 (61.8% expansion) area on the radar.
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