Strong rebound from new lowest since Dec 2021 ($63.63, May 4 low) in past three days is pausing on Tuesday after the action was capped by daily Kijun-sen and 50% retracement of $83.51/$63.63 fall.
Bulls lost traction on weak China’s data, as imports fell much below expectations and exports rose less than previous month, adding weaker economic outlook on concerns that post-Covid recovery may take more time that would sour the demand outlook.
Traders are also focused on US inflation data for April which will be key to the Fed’s next rate decision.
Oil prices could rise further if CPI remains around 5% consensus and core inflation does not ease significantly that would keep the US central bank on track for further tightening despite recent signals that the latest 25 basis points hike would be the last this year.
Technical picture in the daily chart has slightly improved on the latest acceleration higher, but overall picture remains bearish, as negative momentum is still strong and most of moving averages are still above the price.
Also, daily Ichimoku cloud which twists tomorrow and was so far magnetic, is thickening and increasing pressure.
Current easing is still holding within narrowing daily cloud (base lays at $71.96), ahead of Fibo supports at $71.29/22 (23.6% of $63.63/$73.66 upleg/broken Fibo 38.2% of $83.51/$63.63) which should ideally contain and mark a healthy correction ahead of fresh push higher.
Extended dips would face psychological $70 support and a breakpoint, as firm break here would signal an end of recovery phase and shift focus to the downside.
Res: 72.60; 73.66; 74.01; 75.92.
Sup: 71.96; 71.22; 70.00; 69.83.
 in past three days is pausing on Tuesday after the action was capped by daily Kijun-sen and 50% retracement of $83.51/$63.63 fall.){kind=link}