Oil bears have regained momentum after the price failed to break above $40 area. Oil broke below $35 area today as COVID-19 pandemic second wave hit China and the United States. Can WTI decline further? What are the charts and technical indicators are saying? Read more to find further insights into today’s WTI Technical Analysis.
June 15, 2020,| AtoZ Markets – Oil is currently trading around $35.50 area and trying to push higher. After breaking below $35 area, WTI found support around $34.50 area. As per the current price action, its time to see that Oil will continue to climb higher or will continue the bearish pressure in the coming days.
Oil price fell today more than 2 per cent by extending losses from last week as new coronavirus hit the global economy. The second wave may harm the Oil industry and the global demand again may. As a result, a further output cut may take place in the coming days. Besides, Brent crude futures down by 2.3% or 89 cents to $37.84 per barrel by 3:02 GMT. While U.S. West Texas Intermediate crude futures fell by 3.3% or $1.18 to $35.08 per barrel.
On the other hand, ING Economics said in a note, “The recovery in oil demand already set to be a lengthy process, and a fresh wave of cases will certainly raise worries that a recovery in demand may take even longer than initially thought.”
Oil Broke Below as COVID-19 Second Wave’s Concern Rise
WTI is currently residing near $35.50 area and trying to climb higher. Moreover, the price is still residing below the dynamic level of 20 EMA on the intraday chart, which indicated further bearish pressure might take place in the coming days.
Image: Oil 4 Hour Chart
According to the 4-hour chart, Oil broke below $35 area today, but found support around $34.50 area and push higher. As per the current price action, if the price can have a 4-hour bullish close above $35 area, the bulls may push the price higher towards $37 area in the process. In contrary, if the price breaks below $35 area again and has a close below $34.50 area, the bears may continue the bearish pressure towards $32 area.
In addition, the dynamic level of 20 EMA is currently residing above the price. Along with the Kijun line and the Tenkan line. The dynamic level may work as strong resistance and push the price down. The Kijun line and the Tenkan line may work as a confluence of the dynamic level. Besides, the price broke below the Kumo cloud, which indicates current bearish is quite strong may sustain further. Moreover, the MACD lines are currently residing below 0.00 level, which indicates bears are still in the market.
WTI Indecisive Above $35 Area
According to the daily chart, Oil is currently trading around $35.50 area after bouncing from $34.50 area. As per the current price action, if the price can have the daily bullish close above $35 area, the bulls may recover higher towards $40 area in the process. Alternatively, if the price breaks below $34.50 area with a daily bearish close, the bears may sustain the bearish pressure towards $32 area.
Image: Oil Daily Chart
Furthermore, Oil broke below the dynamic level of 20 EMA on the daily chart. It indicates that bears are quite strong may decline further. Besides, the Stochastic Oscillator lines are currently residing below the overbought level 80 and sloping down. It indicates bears may holding the momentum. Also, the RSI indicator line is currently residing below the overbought level 80 and gradually declining. It also indicates the upcoming bearish pressure.
To conclude, as Oil broke below all crucial levels because investors are worried about the Coronavirus pandemic lockdown may extend further. A daily close is needed to find the definite momentum in the coming days.