London Gas Oil Futures are on course to lose the gains that were posted on Monday as the price is set to complete the second bearish day in a row. The technical indicators, though, continue to send bearish signals, suggesting that the softness in the market is not over yet.
The RSI has fallen below the threshold of 50, indicating that the market could weaken a little bit in the short-term, while the MACD supports a bearish picture as well, since the index continues to increase negative momentum below its red-signal line.
Should prices decline, immediate support could be found around the ascending trend line near the 621.70 barrier. Then a leg below that level, the pair could meet the 600.00 psychological level shifting the bullish picture to negative.
However, if the market manages to pick up speed, the 50-day simple moving average (SMA) at 662.92 could offer nearby resistance. A significant close above the latter would drive the price until the 704.60 resistance, taken from the high on May 17, raising chances for further increases.
In the longer-timeframe, oil has been trading in ascending movement over the last year, but the bullish structure could change if the price drops below the diagonal line.
