WTI Price Analysis: Drops towards monthly support around $74.00
- WTI takes offers to refresh intraday low, prints two-day downtrend.
- Failures to cross one-week-old descending trend line, 50-SMA favor sellers.
- Bears need validation from $73.00 to keep the reins.
WTI crude oil remains depressed for the second consecutive day, down 0.80% intraday around $74.55 during early Wednesday in Europe.
The black gold’s latest weakness could be linked to its previous failures to cross the one-week-old resistance line, as well as the 50-bar Simple Moving Average (SMA). It’s worth noting that an absence of an oversold RSI (14) adds strength to the bearish bias.
However, an upward-sloping trend line support from early December, close to $74.00 at the latest, challenges the WTI sellers.
Even if the quote breaks the $74.00 support, a broad region comprising multiple levels marked since late November, between $73.60 and $73.00, appears a tough nut to crack for the crude oil bears.
In a case where the energy benchmark drops below $73.00 support, the odds of witnessing a slump toward the previous month’s low near $70.30, as well as an attack on the $70.00 psychological magnet, can’t be ruled out.
Alternatively, the weekly resistance line near $75.15 guards the quote’s immediate upside ahead of the 50-SMA level surrounding $76.15.
Following that, the $80.00 round figure and the monthly top of $81.55 could lure the WTI buyers.
Overall, WTI crude oil remains on the bear’s radar but the downside appears limited unless breaking the $73.00 level.
WTI: Four-hour chart
Trend: Limited downside expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
