WTI Price Analysis: Teasing a pennant breakdown, eyes $38 mark ahead of EIA
- WTI drops amid risk-off mood, bearish technical set up.
- Risks remain to the downside, with eyes on $38 ahead of EIA.
- Hourly RSI points south, probing the oversold zone.
WTI (futures on NYMEX) is looking to extend Tuesday’s sell-off, as bears gear up for a test of the $38 level amid broad risk-aversion and a potential bear pennant breakdown on the hourly chart.
Tuesday’s over 3% drop and the subsequent consolidation carved out a bear pennant formation on the said time frame, with the price now teasing a breakdown, as we write.
An hourly closing below the rising trendline support at $39.01 could validate the pattern, exposing the target measured at $38.
Ahead of that level, Tuesday’s low of $38.53 could test the bears’ commitment. Backing the case for more declines, the hourly Relative Strength Index (RSI) edges lower, currently at 33.51, probing the oversold territory.
Alternatively, the bearish 21-hourly Simple Moving Average (HMA) at $39.15 could limit immediate bounce from lower levels.
Robust resistance around the $40 mark is the level to beat for the bulls. The 50 and 100-HMA approach each other at the level.
WTI hourly chart
WTI additional levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
