WTI oil futures (July delivery) have been steadily gaining ground after bouncing off 69.40 in mid-March. However, the uptrend seems to have paused at the congested region that includes the 50-day simple moving average (SMA), the upper boundary of the descending channel and the lower end of the Ichimoku cloud.
The momentum indicators currently suggest that bullish forces are intensifying. Specifically, the stochastic oscillator is ascending in the overbought zone, while the RSI jumped above its 50-neutral mark.
Should the price manage to surpass the fortified area, immediate resistance could be met at the 75.70 hurdle. Jumping above that zone, WTI futures may ascend towards the March high of 81.00 or higher to test the 2023 peak of 83.40. Further advances could then cease at the November 2022 high of 92.50.
On the flipside, if the bulls fail to conquer the crucial technical region, the price could reverse towards the recent support of 69.40. A break below that floor could open the door for the double-bottom of 64.20, which is also a 17-month low. Even lower, the price could descend towards levels not seen in the past few months, where the December 2021 bottom of 62.25 could provide downside protection.
In brief, WTI oil futures appear to be in recovery mode after the formation of a bullish double-bottom pattern. For the uptrend to extend, the price needs to pierce through the fortified region that is currently under attack.