WTI OIL outlook: Crude oil collapses on growing demand fears
|WTI OIL
WTI oil extends steep fall into second day, being down 4.5% so far today, after 4.1% drop on Wednesday.
Today's bearish extension broke below key support at $36.11 (08 Sep low) and hit new 4 1/2-month low at 35.35.
Fresh weakness was fueled by growing fears of stall in demand recovery as sharp rise in coronavirus cases and more restrictive measures, threat of further drop in demand.
Strong rise in US crude stocks and decision of OPEC+ group to increase production by 2 million bpd, adds to oversupply fears which could push oil prices significantly lower. Wednesday's close below 200DMA ($37.42) and break below the floor of multi-month range was strong bearish signal that could lead towards deeper correction of Apr/Aug $6.52/$43.75 recovery.
Bears pressure Fibo support at $34.96 (23.6% of $6.52/$43.75), loss of which could spark fresh acceleration towards $30 (psychological) and $29.53 (Fibo 38.2%). Firmly bearish daily techs favor further weakness, but oversold conditions warn that bears may take a breather before resuming. Upticks under broken falling 200DMA expected to offer fresh selling opportunities.
Res: 36.61; 36.96; 37.31; 37.99
Sup: 34.96; 34.33; 32.34; 31.12
Interested in Oil technicals? Check out the key levels
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