Oil prices managed to make an impressive recovery with price action recovering nearly half of the declines set off in the previous two weeks.
As a result, oil prices are now trading near the 41.00 level.
There is, however, a strong hidden divergence on the 4-hour chart which might suggest a possible correction.
To the downside, this would mean that oil prices could correct back to the 38.83 level to form support.
Such a move would validate the upside bias. Alternately, if the bullish momentum continues, then we expect oil prices to continue further to test the 42.00 level.