WTI bears reluctant to chase the offer on maxed ATR, but remain in control

The price for West Texas Intermediate crude, (WTI), is extending the bearish correction from recent recovery highs at $54.48bbls to a current low of $52.07bbls. The warning from the International Monetary Fund and weak economic data out of China that has underlined concerns about global economic growth once again which weighs on the outlook for energy demand, despite the cartel's best efforts to curtail supply this year so far. 

The fund said it expects the global economy to grow 3.5% in 2019, down from a previous forecast of 3.7% in October and a growth rate of 3.7% in 2018, blaming Sino/US trade tensions and rising U.S. interest rates. When coupled with the weekend data that showed that China had reported that its economy expanded by just 6.6% in 2018, which was the slowest pace on record since 1990, bears have taken back control as US traders return from a long weekend to pick up and trade deteriorating futures  -  for February delivery, the contract fell $1.93, or 3.6%, to $51.87bbs on the New York Mercantile Exchange. 

WTI levels

As well as the weekly hanging man, the charts were printing a daily doji following fresh high at the start of this week with no follow through. That bearish analysis has turned out successful and prices are now en route to the 52 the psychological figure. Below there opens the 23.6% Fibo and confluence of the 13th Jan swing lows at 50.63. RSI is leaning bearishly on the daily time frames but ATR is maxed out for today's session, s chasing the offer may not be the prudent trade at this stage. On profit taking, the upside can target 50% of today's move back to the 53 handle targetting the 15th Jan highs at 53,54.