WTI oil price is holding within a narrow consolidation in early Monday, following sharp acceleration lower on Friday (down 2.8% for the day) and weekly loss of 4.3% (the biggest weekly drop since the last week of April.
Oil closed below $80 on Friday, for the first time in five weeks, with near-term action being weighed by large Friday’s and weekly bearish candles.
Friday’s drop was contained by 200DMA ($78.62), with oversold conditions on daily chart, prompting traders for a partial profit-taking.
Oil price was pressured by weaker than expected economic data from China which fueled fears about lower demand from the world’s second largest economy.
Market’s focus is shifting on Fed amid growing expectations that the US central bank would give firmer signals of the timing of the start of monetary policy easing cycle, during the policy meeting on July 30/31, with September seen as possible time to begin cutting interest rates.
Technical picture on daily chart is predominantly bearish, with corrective upticks to be ideally capped by psychological $80 barrier (also daily cloud top) to keep bears in play for further weakness below pivots at $78.62/48 (200DMA / 50% retracement of $72.46/$84.50).
Caution on break above $80 which would sideline immediate bears, but stronger acceleration higher and regain of $81.60/$82.00 zone will be required to revive bulls.
Res: 79.55; 80.00; 80.84; 81.16.
Sup: 78.62; 78.48; 77.06; 76.13.
 and weekly loss of 4.3% (the biggest weekly drop since the last week of April.){kind=link}