Oil prices drop notably today on worries over China’s economy. Data released over the weekend showed PMIs hitting the lowest level since February 2020 due to lockdowns. The economy is on the verge of contraction in Q2 as situation is unlikely to improve any time soon. Meanwhile, Libya also temporary resume operation at a terminal, adding to global supply.
WTI should have finished the rebound form 95.87 and it’s now heading back through 100 handle, towards 95.87 support. But overall, it’s seen as developing another falling leg inside the medium term triangle corrective pattern that started back in 131.82. Downside should be contained by 93.47 support. Larger up trend is still expected to resume at a later stage. The bigger question is whether the final rally of the up trend would ended as a failure fifth that couldn’t even pass through 131.82 high.
