West Texas Intermediate (WTI) futures advanced slightly above the nine-month low of 54.80 after the sharp sell-off in the preceding week but is trading in a narrow range of 55.25 – 58.15. Prices are trading within the 20- and 40-simple moving averages (SMAs) in the 4-hour chart, which are heading for a bullish crossover in the near future.
According to the technical indicators, the MACD oscillator is rising in the negative zone, while the RSI indicator is pointing down slightly below the 50 zone.
Should the price manage to strengthen its rebound on the multi-month low and surpass the 40-SMA, it could find resistance at the 58.15 barrier. Further improvement could drive oil prices until the 23.6% Fibonacci retracement level of the downleg from 76.90 to 54.80, around 60.00 before re-challenging the short-term falling trend line.
Alternatively, if the price continues to head lower the market could push the oil until the 55.25 support, before touching 54.80. More decreases could open the door for the 52.80 support, reached on September 2017.
Overall, WTI crude has been developing in a strong bearish tendency after the bounce off the 76.90 resistance, failing to post a significant upside retracement.
