WTI oil extends weakness on Friday and retests key near –term support at $51.10 (Fibo 38.2% of $49.09/$52.35 / 20SMA) which contained attack on Thursday.
Yesterday’s trading ended in red despite strong downside rejection at $51.10 and subsequent bounce, with fresh easing today, signaling reversal.
Scenario needs close below $51.10 for confirmation, with south-heading daily indicators showing space for further bearish extension.
Firm break below $51.10 would open supports at $50.72 (50% retracement) and $50.34 (Fibo 61.8%) and risk extension towards psychological $50.00 support on break of the latter.
The move is seen as correction of larger uptrend which is well supported by growing signs of oil market rebalancing and repeated crude inventories draws.
Extended corrective action should stay above $50 to keep bulls intact for fresh attempts higher.
Res: 51.10, 51.77, 52.16, 52.35
Sup: 50.72, 50.34, 50.00, 49.86
