WTI crude oil has carved out a double-top chart pattern on the longer-term time frame, signaling that the extended rally from the 2025 lows may be running out of steam.
Price has been sliding steadily from the twin peaks formed around the $100.00 area and is now testing critical support near the $80.62 level, putting the neckline of the formation squarely in the spotlight.
The neckline support zone sits around the $80.00–$81.00 area, highlighted by the shaded region on the chart. A decisive break and close below this floor could confirm the double-top breakdown and set off a measured move to the downside, as the height of the formation projects a potential drop toward the $60.00 region
This also happens to coincide with where the 100 SMA and 200 SMA were converging back in late 2025 before the big rally kicked off. Speaking of moving averages, the 100 SMA has been tracking above the 200 SMA for most of this period, which has kept the broader bias tilted to the upside.
However, price has now sliced back below the 100 SMA dynamic support, and a bearish crossover between the two indicators could be on the horizon if selling pressure continues to build. This would shift the path of least resistance firmly to the downside.
Stochastic has tumbled deep into the oversold zone, reflecting the intensity of the recent selloff. The oscillator is approaching levels that have previously sparked at least a short-term bounce, so a brief corrective rally cannot be ruled out before the downtrend resumes.
RSI tells a similar story, hovering near oversold territory and still pointing lower, suggesting that sellers remain in firm control for now. A sustained bounce in the oscillator would be needed to ease immediate bearish pressure.
Traders appear to be unwinding the geopolitical war premium associated with crude oil and global supply concerns now that the US and Iran have reached a ceasefire agreement.
Comments
Log in or sign up to join the conversation.