Oil, Natural Gas, USD/CAD Technical Analysis: Navigating OPEC+ Uncertainty and Key Market Moves

WTI crude oil (CL) faces uncertainty ahead of the OPEC+ meeting and consolidates within tight ranges. The market anticipates that OPEC+ could extend production cuts beyond the consensus expectation of a three-month delay. Moreover, geopolitical tensions are adding to the volatility in the oil market. President-elect Donald Trump has hinted at potential Middle East conflicts over unresolved hostages. Meanwhile, crude inventory data shows mixed signals. The API reported a surprise build of 1.232 million barrels. Similarly, the natural gas (NG) price corrects from the strong resistance of $3.60.

On the other hand, USD/CAD increased toward 1.4070, supported by lower crude prices and rising expectations of a Bank of Canada (BoC) rate cut. The commodity-linked Canadian dollar remains under pressure as crude oil prices weaken. This is a significant factor, given Canada’s role as the largest oil exporter to the US. Additionally, upcoming Canadian Ivey PMI data and US unemployment claims could further influence the pair. Fed Chair Jerome Powell’s remarks about the strong US economy and low unemployment bolster the Greenback. This signals cautious optimism from the Federal Reserve, which contrasts with the BoC’s dovish stance.

While weak US Services PMI data temporarily softened the US dollar, expectations that the BoC will ease rates more aggressively provide a buffer for the Greenback against the Canadian dollar. However, the lower oil prices drive USD/CAD toward potential upward momentum in the near term.

WTI Crude Oil (CL) Technical Analysis

Oil Daily Chart – Consolidation at Apex of Triangle

The daily chart for WTI crude oil shows the price approaching the apex of a triangle pattern. Price fluctuations may decrease near the apex, and a breakout from this pattern could trigger a significant move. The oil market recently attempted another rebound toward the triangle’s resistance but has since dropped toward the $67 area. The price remains below the 50-day SMA, and the RSI is below the midline, indicating sustained bearish pressure in the oil market.

Oil 4-Hour Chart – Bearish Pattern at Apex of Triangle

The 4-hour chart for WTI crude oil shows that the price is correcting from the triangle’s resistance. The support for this move lies at the triangle’s base around the $66.70 level. The RSI remains below the midline, indicating a potential continuation of the downward movement in the oil market.

Natural Gas (NG) Technical Analysis

Natural Gas Daily Chart – Cup and Handle Pattern

The daily chart for natural gas shows the formation of a cup and handle pattern. The price has started to correct lower from the resistance at $3.60 and found support around the $3 level. A break below $3 could push natural gas prices toward the $2.60 zone. The 50-day SMA is above the 200-day SMA, and the RSI is holding near the midline, indicating bullish momentum in natural gas prices. A break above $3.60 would signal a strong upward move.

Natural Gas 4-Hour Chart –Ascending Channel

The 4-hour chart for natural gas shows the formation of an ascending channel pattern, with the price currently in correction mode from the channel’s resistance. Support has been found at the midline of the channel around $3. A break below this level could push natural gas prices toward the $2.60-$2.70 zone, where strong support is located. The overall trend remains upward, and the RSI has approached the oversold level, indicating strong support for natural gas prices.

USD/CAD Technical Analysis

USD/CAD Daily – Price Volatility

The daily chart for USD/CAD shows that the price has broken the pivotal resistance level at $1.3875, initiating upward momentum. This breakout has propelled the pair toward the ascending channel’s resistance around the 1.42 zone. However, after reaching this area, the pair continues to exhibit bullish price action and is eyeing the $1.4250 level.

USD/CAD 4-Hour Chart – Bullish Development

The 4-hour chart for USD/CAD shows bullish price action characterized by the formation of an inverted head and shoulders, a double bottom, and a rounding bottom. The inverted head and shoulders pattern developed in September, followed by a double bottom in November and a rounding bottom in December.

The breakout above the pivotal resistance at $1.3875 on the daily chart triggered further bullish momentum. The breakout above $1.3950 on the 4-hour chart also resulted in a spike, followed by a correction that formed a rounding bottom. These patterns suggest that the pair may continue to rise toward the $1.4250 level.