|

WTI slumps over 3.50% to fresh three-month lows sub-$38.50

  • WTI sold-off amid a renewed risk-aversion wave.  
  • Rising US-China tensions, demand concerns weigh on oil.
  • Focus shifts to US weekly crude stocks data.

Following a temporary reversal seen on Monday, WTI (futures on Nymex) resumes its downside momentum and hits fresh three-month lows just above $38, shedding nearly 4% so far.

WTI sellers returned along with the risk-aversion on the European markets, as escalating US-China tensions combined with growing coronavirus cases across Europe dent the appetite for riskier assets.

Earlier this Tuesday, the NY Times reported that the US is considering a ban on some of the cotton products from China’s Xinxiang province. Meanwhile, President Donald Trump said he plans to end America’s reliance on the country.

Further, the continued rise in the coronavirus cases globally casts doubts over the strength of the economic recovery, in turn weighing on the prospects for oil demand. Recall that China’s oil imports slowed down last month. The dragon nation is the world’s biggest oil importer.   

The selling bias in the black gold picked up pace after Saudi Arabia made the deepest monthly crude oil price cuts for its Asian customers. Also, unabated demand for the US dollar across its main competitors adds to the weight on the USD-sensitive oil.

Markets now look forward to the sentiment on Wall Street, as full market returns. The next of relevance remains the weekly crude supply reports for a fresh trading impetus.

WTI technical levels to watch

“On the downside, key supports are seen at $38.54 (July 10 low) and $37.08 (June 25 low). Alternatively, resistances are located at $40 (psychological level) and $41.97 (10-day SMA). A close above the 10-day SMA is needed to invalidate the bearish bias,” FXStreet’s Analysts Omkar Godbole explained.

WTI additional levels

WTI

Overview
Today last price38.38
Today Daily Change-0.76
Today Daily Change %-1.93
Today daily open39.41
 
Trends
Daily SMA2042.39
Daily SMA5041.54
Daily SMA10036.29
Daily SMA20041.78
 
Levels
Previous Daily High39.78
Previous Daily Low38.8
Previous Weekly High43.7
Previous Weekly Low39.61
Previous Monthly High43.86
Previous Monthly Low39.75
Daily Fibonacci 38.2%39.18
Daily Fibonacci 61.8%39.41
Daily Pivot Point S138.88
Daily Pivot Point S238.35
Daily Pivot Point S337.9
Daily Pivot Point R139.86
Daily Pivot Point R240.31
Daily Pivot Point R340.85

Author

Dhwani Mehta

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.

More from Dhwani Mehta
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD recovers to 1.1750 region as 2025 draws to a close

Following the bearish action seen in the European session on Wednesday, EUR/USD regains its traction and recovery to the 1.1750 region. Nevertheless, the pair's volatility remains low as trading conditions thin out on the last day of the year.

GBP/USD stays weak near 1.3450 on modest USD recovery

GBP/USD remains under modest beairsh pressure and fluctuates at around 1.3450 on Wednesday. The US Dollar finds fresh demand due to the end-of-the-year position adjustments, weighing on the pair amid the pre-New Year trading lull. 

Gold retreats to $4,300 area, looks to post monthly gains

Gold stays on the back foot on the last day of 2025 and trades near $4,300, possibly pressured by profit-taking and position adjustments. Nevertheless, XAU/USD remains on track to post gains for December and extend its winning streak into a fifth consecutive month.

Bitcoin, Ethereum and XRP prepare for a potential New Year rebound

Bitcoin, Ethereum, and Ripple are holding steady on Wednesday after recording minor gains on the previous day. Technically, Bitcoin could extend gains within a triangle pattern while Ethereum and Ripple face critical overhead resistance. 

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Crypto market outlook for 2026

Year 2025 was volatile, as crypto often is.  Among positive catalysts were favourable regulatory changes in the U.S., rise of Digital Asset Treasuries (DAT), adoption of AI and tokenization of Real-World-Assets (RWA).