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Oil rebounds; key resistance ahead

WTI Crude oil has been falling in price. Last week, price fell below 40 briefly, but held above 39.00 and was eventually able to rebound. This week, the rebound will be challenged by some key resistance factors.

USDWTI 4H Chart 8/8

(click to enlarge)


Resistance factors:
- 42.80-43.20 is a support/resistance pivot area going back to April. 
- There is a falling trendline that challenges the current rally at about 43.00.
- The RSI is about to tag 70, which would 1) signal overbought conditions, but also 2) reflect some bullish momentum in this last bullish swing.

Bearish, bearish-neutral mode:
- I think the current rally can still be within the bearish scenario if price holds under 43 and slides back below 42.
- In this bearish continuation scenario, there is still further downside towards the area around 38.00, another support/resistance pivot area. 
- However, if price climbs above 43.20, oil might have neutralized the prevailing bearish run since June. 
- I would not be bullish on oil yet, but I would limit and bearish target to the 40-41 area, with the expectation that price will hold above 40.00. 
- To the upside, I would also be somewhat conservative because USDWTI could simply be in a large consolidation mode. 
- In this bearish turning neutral scenario, my upside will be limited to the 44.50-45 area.