WTI Price Analysis: Reverses from three-week high towards previous resistance surrounding $78.50
- WTI takes offers to refresh intraday low, snaps four-day uptrend.
- RSI’s retreat from overbought territory, sluggish MACD favor latest declines.
- Five-week-old previous resistance, 200-SMA restrict short-term downside moves.
- Oil bulls have a bumpy road to travel in case of fresh recovery.
WTI crude oil returns to the bear’s radar, after a four-day winning streak, as the energy benchmark takes a U-turn from a three-week high to print 0.70% intraday losses around $79.30 during early Monday.
In doing so, the black gold traces the RSI (14) as it reverses from the overbought territory. However, the sluggish MACD signals hint at the lack of momentum and hence challenge the Oil bears.
Additionally testing the commodity’s latest weakness could be a downward-sloping support line from January 27, previous resistance around $78.45.
Even if the WTI bears manage to conquer resistance-turned-support of near $78.45, the 200-SMA and an ascending support line from late February, respectively near $78.10 and $77.70, could restrict the quote’s further downside before convincing the sellers.
Meanwhile, recovery moves may initially aim for the $80.00 psychological magnet before targeting the five-week-long horizontal resistance area surrounding $80.65-70.
Following that, a horizontal resistance zone comprising tops marked since January 18, close to $82.65-70, could challenge the WTI bulls before giving them control.
Overall, WTI crude oil is likely to witness further downside but the bears need to remain cautious unless witnessing a clear break of the $77.70.
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.
