Head and Shoulder on WTI Crude Oil front month contract

Head and shoulder formation on WTI Crude Oil: It is a slant H&S or skewed if you want and needs a confirmation - the right shoulder formation. At this stage, it looks very probable that it will form one. The pattern will confirm on no candle close above the head, while the neckline is either a downtrend/horizontal line around 57.40. A break of this level, accompanied by volume, will pave the way for corrections: Target 1 - around 51.72 (translated distance between right shoulder and neckline, below the neckline) and Target 2: around 47.32 (translated distance between head and neckline, below the neckline)

Fundamentally, oil has had more bearish news lately with a shortfall in global demand relative to its pre-pandemic levels. According to IEA, global oil demand will reach pre-pandemic levels only around 2023. Moreover, OPEC has recently agreed to ease production cuts as from May 2021 which should add to the current industry glut. Overall, there is a good mix of factors for Oil to correct.