Oil nose dive shocked the investors as it hit the record low during the Asian session today. Oil hits record low at $16.50, will continue lower? What are the charts and technical indicators are saying? Read more to find further insights into today’s WTI Technical Analysis.
April 20, 2020 | AtoZ Markets – Oil is currently residing around $17.50 area and trying to push lower. The price dropped sharply from $19 and reached $16.50 in hitting the 21 year low. As per the current price action, WTI price may decline further and may make new record lows in the coming days.
U.S. Crude, West Texas International has fallen to $16.50 area as global economies remain on lockdown amid this Coronavirus pandemic. Moreover, global Oil storage is reaching its limits, even the Department of Energy is considering paying domestic Oil procedures to retain crude in the ground. Besides, the International Energy Agency reported a record 19 million barrel just to increase in the domestic crude oil stocks.
On the other hand, Vandana Hari, founder of Vanda Insights, told Bloomberg, “The current prices show that the OPEC+ cuts proved to be a blip, with Oil prices at the mercy of the virus once again. Until we approach a lifting of the lockdowns in the U.S., Oil may drift lower or remain range-bound around current levels.”
Besides, he also added, “The output cut that we’ve seen, or supposed to see coming, isn’t sufficient to cover the 25 million to 30 million barrels of daily demand that’s being destroyed by COVID-19. We have to see a peak for COVID-19 globally to get a clearer picture of how much demand will be destroyed.”
Oil Hits Record Low as COVID-19 Impacted the Daily Demand
WTI is currently trading around $17.50 area after the price broke below $19 last week. Oil current bearish pressure is quite impulsive may see further downward pressure in the days ahead.
Image: Oil 4 Hour Chart
According to the 4-hour chart, WTI is currently residing near $17.50 area and trying to decline further. Oil failed to hold the price above $19 area and fell sharply to $16.50 today. As per the current scenario, if Oil price sustains below $17.50 area in the process, the bears may push the price further towards $15 area.
Furthermore, the dynamic level of 20 EMA is currently residing above the price, which may act as a strong resistance and push the price down. Besides, the MACD lines are residing below 0.00 level, which indicates further bearish pressure can be seen in the days ahead.
WTI May Jump Higher From $15 Support Level
According to the Daily chart, Oil hits record low and currently residing near $17.50 area. After rejecting the dynamic level, the bears push the price lower quite aggressively. As per the current price action, if the price reaches $15 area and bounces with a daily close, the bulls may regain momentum and push the price higher towards $27.50 in the process.
Image: Oil Daily Chart
Moreover, the dynamic level of 20 EMA is residing above the price, which may pull the price as a Mean Reversion. Besides, the Stochastic Oscillator lines were residing below over-sold level 20 and had a bullish intersection, which indicates bulls may regain momentum in the coming days.
To conclude, Oil hits record low as Coronavirus hit the global demand of the energy, which may call for a further output cut. WTI price may experience further downward pressure, as long as the COVID-19 pandemic situation remains unchanged.