WTI Price Analysis: Sets for a bumpy ride to $75.00 as recession fears deepen

Oil prices are showing signs of volatility contraction following the footprints of a sideways US Dollar.
More rate hikes from central banks would put a serious dent in the oil demand.
The black gold is expected to surrender entire gains generated after the announcement of production cuts by OPEC+.

Sagar Dua FXStreet

West Texas Intermediate (WTI), futures on NYMEX, are showing signs of volatility contraction around $77.60 in the Asian session. The oil price showed a decent recovery after cracking to near $76.70 but is struggling for extending its recovery further as investors are worried that more rate hikes from Western central banks to strengthen their dominance on stubborn inflation would put a serious dent in oil demand.

Western central banks are preparing for a fresh rate hike cycle for May. The Bank of England (BoE) and the Federal Reserve (Fed) are expected to raise interest rates further by 25 basis points (bps). Meanwhile, investors are divided over the pace of the interest rate hike by the European Central Bank (ECB).

Meanwhile, the US Dollar Index (DXY) has shown a rebound move after defending its crucial support of 101.63. The recovery move by the USD Index is yet to go through more filters to infuse confidence among investors that the rebound is for real.

The oil price witnessed a steep fall after dropping below the crucial support placed from April 03 low at $79.00, which has turned into resistance for bulls. The downside move in the black gold is expected to surrender entire gains generated after the surprise announcement of production cuts by OPEC+.

The 20-period Exponential Moving Average (EMA) at $77.88 is acting as a barricade for the oil bulls.

Meanwhile, the Relative Strength Index (RSI) (14) is expected to fall back within the bearish range of 20.00-40.00.

Going forward, a decisive downside below $75.00 will expose the oil price to March 30 low at $72.69 followed by the round-level support at $70.00.

On the flip side, a confident break above April 03 low at $79.00 will drive the oil price toward April 04 high at $81.80 and April 12 high at $83.40.

WTI two-hour chart

WTI US OIL

Overview
Today last price	77.48
Today Daily Change	-0.44
Today Daily Change %	-0.56
Today daily open	77.92

Trends
Daily SMA20	78.32
Daily SMA50	76.41
Daily SMA100	76.94
Daily SMA200	82.15

Levels
Previous Daily High	78.34
Previous Daily Low	76.69
Previous Weekly High	82.61
Previous Weekly Low	76.69
Previous Monthly High	80.99
Previous Monthly Low	64.39
Daily Fibonacci 38.2%	77.71
Daily Fibonacci 61.8%	77.32
Daily Pivot Point S1	76.96
Daily Pivot Point S2	76
Daily Pivot Point S3	75.31
Daily Pivot Point R1	78.61
Daily Pivot Point R2	79.3
Daily Pivot Point R3	80.26

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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