Oil and Natural Gas Technical Analysis – Bearish Signals in Oil, Bullish Setup in Natural Gas

Oil prices dropped on Thursday after bearish supply signals from the US and Saudi Arabia. Brent crude oil (BCO) declined to $64.60 per barrel, while WTI crude oil (CL) slipped to $62.55. This followed a nearly 1% decline on Wednesday after US data showed a larger-than-expected build in gasoline and distillate stockpiles, signalling weakening demand in the world’s top oil consumer.

On the other hand, Saudi Arabia’s move to cut July crude prices for Asian buyers further pressured the market. The pricing now sits near the lowest in four years. This action came just days after OPEC+ agreed to raise output by 411,000 barrels per day for July. Saudi Arabia and Russia aim to enforce discipline among members and regain market share, contributing to market uncertainty and supply expectations.

Moreover, global trade tensions are compounding the bearish sentiment. New US metal tariffs have disrupted trade, prompting potential reprisals from Canada and renewed urgency in EU negotiations. The higher tariffs and global uncertainty could slow economic growth. A weaker outlook typically reduces oil demand, keeping prices under pressure in the near term.

WTI Crude Oil (CL) Technical Analysis

WTI Oil Daily Chart – Consolidation

The daily chart for WTI crude oil shows the price consolidating below the $66 resistance level. Strong consolidation below the 200-day SMA indicates persistent bearish pressure. If the price remains below $66, the downward trend will likely continue. However, a break above the $70 area would signal further upside toward the $75 region.

WTI Oil 4-Hour Chart – Descending Broadening Wedge

The 4-hour chart for WTI crude oil shows that the price is consolidating within a descending broadening wedge pattern. Strong consolidation between the $60 and $64 area indicates market uncertainty. A break below $60 would signal further downside, while a break above the $67 area would suggest a move toward $70. A confirmed break above $70 would shift the trend toward a bullish outlook.

Natural Gas (NG) Technical Analysis

Natural Gas Daily Chart – Bullish Momentum

The daily chart for natural gas (NG) shows that the price consolidates above the $3 area and forms a bullish structure. The price has broken above the 50-day SMA, indicating further upside potential. A buy signal has emerged at the 200-day SMA, and the price is building a bullish formation. It has entered an ascending channel, which suggests a likely continuation toward the $5 area.

Natural Gas 4-Hour Chart – Constructive Rebound

The 4-hour chart for natural gas also shows strong consolidation below the $3.80 level. A break above $3.80 will signal continued momentum toward $4.70. However, a break below the $3 area will indicate further downside.

US Dollar (DXY) Technical Analysis

US Dollar Daily Chart – Bearish Pressure

The daily chart for the US Dollar Index shows that the index is trading under bearish pressure. The failure to break above 100.65 has opened the door to further downside. A continuation below 98 will signal more weakness toward the 96 level, which could open the path for a slide toward the 90 area.

US Dollar 4-Hour Chart – Bearish Pressure

The 4-hour chart for the US Dollar Index also shows strong bearish pressure within the descending channel. The index consolidates below the 101.60 area, indicating it will likely continue lower. Immediate strong support lies near the 96 region. Moreover, the NFP data on Friday will be key in driving the US Dollar in the next direction.