WTI Price Analysis: Oil drops below $70.00 but 100-HMA prods bears
- WTI licks its wounds after posting the first daily loss in four.
- U-turn from one-week-old resistance line breaks 200-HMA and joins downbeat oscillators to favor sellers.
- 100-HMA offers breathing space to bears before directing them to multi-month low.
- Bulls need successful break of $72.70 for confirmation.
WTI crude oil flirts with the 200-HMA as bears take a breather after returning to the table, following a three-day absence, during early Friday. In doing so, the black gold consolidates the previous day’s U-turn from a one-week high amid a sluggish Asian session.
That said, the quote reversed from an upward-sloping resistance line from March 16 the previous day to welcome bears. The downside move gained momentum after breaking the 200-Hour Moving Average (HMA). It should be noted that the bearish MACD signals and the downbeat RSI (14) line, not oversold, also back the energy benchmark’s latest weakness.
Hence, the quote’s corrective bounce remains elusive unless crossing the aforementioned resistance line, near $71.80 at the latest.
Even so, the mid-March swing high and 50% Fibonacci retracement of the commodity’s fall from March 07 to 20, around $72.70 by the press time, appears crucial for the WTI crude oil buyers to retake control.
Alternatively, the 100-HMA level of $68.65 puts a floor under the WTI crude oil price, a break of which could direct bears towards the seven-day-old horizontal support area surrounding $66.00-65.45.
In a case where the quote resists bouncing off the stated key support, the odds of witnessing a slump to refresh the multi-day low marked earlier in the week, around $64.40, can’t be ruled out.
WTI: Hourly chart
Trend: Further 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.
