After reaching its highest level in more than seven years, the energy commodity lost 2.63% in one trading session. The pair reached $85.39, and it could break that level in the short to mid-term.
The Bollinger bands are closing up after the most recent loss; this indicates lower volatility and a potential price consolidation in the low 80's before we can see a breakout. The price traded very close to the upper band, considering it relatively high.
The relative strength index just recovered from an overbought status; another reason why we see a retracement in the price. The pair's RSI stayed overbought for more than 12 trading days. The retracement did not come as a surprise; it's natural for the price to drop back a few points after such a strong rally.
Our parabolic SAR indicator suggests that the price will continue to move upwards in the short term. However, we believe the price could enter a temporary consolidation period before breaking out or down.
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