Oil Prices Escape Death Cross, Golden Cross Hopes Revive

The recent decline in oil prices has avoided a potentially bearish technical signal known as a 'death cross,' but traders now face a critical test between renewed gains and another wave of selling.

The price of Brent crude, the international benchmark, has largely been reacting to developments in the conflict surrounding Iran since late February. The drop in prices amid expectations of a possible resumption of shipping through the Strait of Hormuz in September coincided with a correction following the April high.

The decline brought the 50-day moving average close to the 200-day indicator since late May, but a crossover did not occur, thus avoiding a 'death cross.' Fresh doubts about a swift easing of tensions surrounding Iran have pushed oil prices higher again. Charts may now produce an opposite signal: the 10-day moving average is approaching a potential upward crossover of the 100-day average.

This pattern is known as a 'golden cross,' generally seen as a potential signal of further price gains, although the pace of the latest rally has already begun to weaken. The following levels remain important for Brent crude prices: breaking above September's high of $94.83 per barrel could restore upward momentum and open the way toward July's peak of $102 per barrel.