Crude Oil Analysis: Key Resistance Looms as Bears Eye Next Leg Down

In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the UKOUSD for August 7, 2025.

Technical Analysis of UKOUSDUKOUSD Daily Chart Insights

• Stochastic Oscillator: The indicator is in oversold territory below 20, suggesting the recent selloff may be overdone and the asset could see a bounce or consolidation. However, oversold conditions arent buy signals on their own, as prices can stay oversold during strong downtrends. Traders should watch for a bullish crossover as an early bounce signal.

• Key support area: The immediate support level to monitor is the most recent low around $68.00. The next significant support lies at approximately $65.80, which corresponds to the low from late May 2025. The most critical support level on the chart is near $59.50, marking the low from early April 2025, and a break below this major support would signal a strong bearish continuation.

UKOUSD 2-hour Chart Analysis

• Corrective Bounce: Although the asset remains in a strong downtrend, the Stochastic oscillator has entered oversold territory below 20 and is displaying a bullish crossover with the %K line moving above the %D line. The pattern indicates that selling pressure may be temporarily depleted, positioning the market for a short-term relief rally or consolidation phase before any potential continuation of the decline.

• Breakout scenarios: Given the oversold stochastic reading, a bounce is a probable scenario. The first target for any upward move would be the immediate resistance at $69.40. Should the bounce gain additional momentum, it could extend toward the key resistance zone of $70.00 – $70.50, an area where the downtrend would most likely resume.

UKOUSD Pivot Indicator

• The price is currently experiencing a short-term corrective bounce after reaching a significant low around $67.025. The asset has moved above the short-term purple moving average, while the Stochastic oscillator has climbed out of oversold territory. These developments indicate a temporary relief rally or consolidation period within the broader downtrend.

• Bearish Continuation: The most likely outcome is that the current corrective bounce will encounter failure at or near one of the resistance levels. Traders should monitor for signs of weakness, such as bearish candlestick patterns, as the price approaches the 68.60-69.50 resistance zone.

• Bullish Breakout: For the bullish correction to continue, the price must achieve a sustained breakout and close above the immediate resistance at 68.60.

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