WTI oil fell $1 on Thursday after repeated failure to sustain break above $52.00 barrier. Probes above $52.00 were repeatedly rejected in past few days with stronger indecision signal and possible rally stall being generated in double Doji in past two days.
Techs also support scenario of reversal as slow stochastic reversed from overbought territory on daily chart and daily RSI turned south, moving also below its 7d moving average.
Dips is so far holding above pivotal $51.00 support zone (Fibo 38.2% of $49.09/$52.35 upleg / converged 10/20SMA’s), with sustained break here needed to signal deeper pullback and expose Fibo supports (50% and 61.8%) at $50.72 and $50.34 respectively.
On the other side, fundamentals remain firm and supportive for further advance as oil sectors is nearing rebalancing after long period of oversupply which depressed oil prices, concerns about output disruption from Iraqi oilfields has faded and US crude stocks fell for the fourth consecutive week.
Limited downside action is needed to keep focus at the upside for final attack at key $52.84 barrier (28 Sep high).
Res: 52.16, 52.35, 52.84, 53.18
Sup: 51.00, 50.72, 50.34, 50.00
