WTI: 100-hour MA is capping upside on recession fears

  • Oil is currently probing the 100-hour MA resistance amid US recession fears. 
  • With the futures on the S&P 500 pointing to risk reset, oil prices could rise above the MA hurdle. 

WTI oil's bounce from the seven-day low of $58.20 hit yesterday is struggling to break above the 100-hour MA, currently at $59.35. 

The black gold is struggling to beat the MA hurdle, possibly due to heightened recession fears. On Friday, a section of the treasury yield curve inverted - the spread between the US 10-year and two-year Treasury yields turned negative for the first time since 2007 - triggering fears of recession. Further, the German 10- year bond yield turned negative for the first time since 2016. 

That said, the futures on the S&P 500 are up 0.24 percent at press time, meaning a risk reset could be in the offing. Oil, therefore, may find acceptance above the 100-hour MA hurdle. 

Moreover, risk reset would shift the focus back to the ongoing supply cuts led by producer club OPEC and by U.S. sanctions on Iran and Venezuela. 

That said, the immediate bias is bearish, as per technical studies. The black gold fell 1.67 percent on Friday, confirming a bearish doji reversal. Further, on the 4-hour chart, a head-and-shoulders would be formed if prices retreat from the current level of $59.24. 

Technical Levels

    1. R3 60.76
    2. R2 60.09
    3. R1 59.6
  1. PP 58.93
    1. S1 58.44
    2. S2 57.77
    3. S3 57.28


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD extends its gains toward 1.1300 after the dovish Fed decision

EUR/USD has extended its gains after the Fed opened the door to cutting interest rates, stating that uncertainties have increased. Markets are awaiting EU leaders to divvy up top jobs.


GBP/USD holds onto gains after retail sales, ahead of the BOE

GBP/USD has extended its gains above 1.2700 after the Fed opened the door to rate cuts. UK retail sales fell by 0.5% in May as expected. The BOE's decision and two more rounds of the Conservative contest await traders.


USD/JPY tumbles to fresh multi-month lows in tandem with a slump in US bond yields

The USD weakens after the Fed opened doors for rate cuts by the end of 2019. Bearish traders further took cues from the ongoing slump in the US bond yields. BoJ’s decision to maintain status-quo fails to provide any respite for the bulls.


Gold: Bulls target 2014 top, overbought RSI doubts the rise

With the global risk-aversion wave fueling Gold prices to the highest since March 2014, the yellow metal aims for that year top during additional upside. However, overbought RSI can trigger the pullback moves.

Gold News

FOMC: Prelude to a rate cut?

The Federal Reserve added little new to its policy prescript in Wednesday’s FOMC statement and economic projections and with the anticipation for a July rate cut long priced into market levels the reaction was decidedly uninvolved.

Read more