WTI oil – Head and Shoulder on the daily chart

The breach of rising trend line followed by a falling tops formation suggests a potential for a drop to head and shoulder neckline level of $51.00 levels.

A break below the same cannot be ruled out, although the losses are likely to be restricted around $50.60 (50-DMA) levels.

All three major averages – 50, 100 & 200 – are perfectly aligned and are sloping higher, thus suggesting the long-run outlook remains bullish.