Summary:
- Oil.WTI has fallen back below $48
- Drop of around 2% on the day
- Price has retraced 50% of Friday’s rally
The price of oil is sliding lower today with Oil.WTi falling by approximately 2% to trade back below the $48 handle. The final session of last week was marked by a strong move higher in crude which saw the market rally strongly into Friday’s close. The day’s trade saw the market recover practically all of the week’s prior declines and move back above the 8 and 21 day EMAs.
The daily chart looks more constructive for longs after Friday’s move higher and the convergence of the 8 and 21 period EMAs could see a bullish cross printed (8 above 21). The market appears finely balanced at present and should there be a push above last week’s highs then a move to 50.45 may occur. This would be the real Litmus test for the longer term trend as a break above 50.45 would negate the series of lower highs and could well lead to a sustained move higher.
Alternatively a drop back below the EMAs would support short positions and should Friday’s low of 46.93 give way then further declines may be expected.
Oil.WTI currently sits at a key level with the 8 and 21 EMAs on D1 converged closely. Source: xStation
Today’s trade has seen a retracement of Friday’s rally with more than 50% of the surge higher having been handed back. The 61.8% fib retracement at 47.69 could be a potential support level to watch for and if price breaks below this level then further declines back towards 46.93 could occur.
Oil.WTI has handed back more than 50% of Friday’s gains. Source: xStation