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Oil fails to sustain gains and closes below $28.00/bbl

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 10, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    Crude oil prices have extended their decline towards fresh 12-year lows, with WTI futures down to $27.25 a barrel in spite US crude stockpiles unexpectedly fell by 754K barrels against expectations of a 3.6M build, according to the latest EIA report.

    The commodity enjoyed some demand afterwards, and advanced briefly beyond $29.00, before turning back south, as a weekly decline in inventories is not enough to ease concerns over a worldwide glut.

    WTI technical perspective

    “The black gold is currently a few cents above the mentioned low, and there are no technical signs that it will reverse course any time soon, as in the daily chart, the commodity posted a lower low and a lower high well below its moving averages, while the technical indicators remain well into negative territory. Furthermore, the RSI indicator maintains a strong bearish slope around 36, anticipating further declines”, said Valeria Bednarik, chief analyst at FXStreet. “In the shorter term, the 4 hours chart shows that the RSI indicator heads south in oversold territory, while the Momentum indicator lacks directional strength within bearish territory as the 20 SMA heads strongly south above the current level”.

    Support levels: 27.25 26.60 26.00. Resistance levels: 27.90 28.60 29.20.
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