WTI oil remains in red on Thursday and extends strong fall of previous two days.
Oil prices came under increased pressure on expectations for Fed’s more aggressive approach to the monetary policy which boosted dollar and strong build in US crude inventories last week, which accelerated pullback from recovery high at $64.22, posted on Monday.
Tuesday’s close below pivotal support at $61.92 (Fibo 38.2% of $58.19/$64.22 rally, reinforced by converged 20/55SMA’s) generated strong bearish signal.
Fresh extension lower today pressures initial support at $61.20 (Fibo 50%) and eyes next pivots at $60.72 (daily cloud base) and $60.49 (Fibo 61.8% of $58.19/$64.22).
Bear received fresh boost from formation of 20/55 SMA bear-cross today, which also capped brief recovery attempts.
Daily MA’s turned to firm bearish setup, but bullishly aligned momentum studies may obstruct bears on approach to daily cloud base.
Bullish scenario requires stronger positive signals on lift above broken Fibo barrier at $61.92 and 10SMA ($62.25) to sideline immediate downside risk, but reversal above daily cloud is needed to neutralize.
Res: 61.92, 62.33, 62.73, 62.92
Sup: 61.20, 60.72, 60.49, 60.00
