FX.co ★ Technical analysis on Oil for August 4th, 2023.

Red line- bearish RSI divergence

Blue lines- bullish channel

Oil is making fresh new highs above $83 as price continues forming higher highs and higher lows inside the blue upward sloping channel. Oil remains in a bullish trend since the middle of June. Despite making a new higher high in price, the RSI has provided another lower high, thus a bearish divergence. This is not a reversal signal but a warning of weakening up trend. Support by the channel is found at $80.20. A break below this level will most probably be a trend reversal. Recent pull back to $78.69 respected the channel lower boundary. This price action confirmed the importance of the channel support.