WTI Price Analysis: Retreats from two-month high, sellers need validation from $79.50
- WTI steps back from multi-day high, pressured around intraday low.
- Overbought RSI triggers pullback but three-week-old support line, 23.6% Fibonacci retracement limits immediate downside.
- Multiple levels since late October restricts immediate upside.
WTI crude oil buyers take a breather after a two-day uptrend near the highest level since early November. That said, the US oil benchmark drops 0.25% intraday while taking rounds to $81.90 of late.
Overbought RSI conditions triggered the WTI pullback from a multi-day high. However, the commodity’s further weakness remains doubtful until its stays beyond the $79.50 support confluence, comprising ascending trend line from December 21 and 23.6% Fibonacci retracement of August-October 2021 upside.
In a case where WTI drops below $79.50, January 10 swing low near $78.00 should return to the chart. Though, a convergence of the previous resistance line from October, a six-week-old upward sloping trend line and 38.2% Fibo level, near $76.15, becomes a tough nut to crack for the bears.
Meanwhile, the quote’s further upside will wait for the fresh multi-day high, currently around $82.50, before challenging a three-month-long horizontal area near $83.50-84.00.
Should oil prices rally past $84.00, the latest high surrounding $85.00 and the $90.00 psychological magnet will be on the trader’s radar.
To sum up, oil prices retreat but the bulls are not out of the woods yet.
WTI: Daily chart
Trend: Pullback 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.
