WTI oil price remains in red for the third straight day, deflated by growing hopes of a ceasefire agreement in the Middle East and rising US crude inventories.
Also, stubbornly high US inflation continues to cool rate cut expectations and adds concerns that demand would weaken further in current conditions.
The daily chart shows growing negative signals as bearish momentum is strengthening, the price fell below 10/20/55DMA’s, and the action is about to complete a failure swing pattern.
The price hit five-week low in early trading on Wednesday and pressuring key support at $80.00 zone (psychological / Fibo 38.2% of $67.70/$87.61 / 200DMA / top of rising daily cloud).
Bears are likely to face increased headwinds here, though overall picture is negative, with widely expected decision of the US central bank to stay on hold today and keep high interest rates for prolonged period, which would further harm demand outlook.
Sustained break of $80 zone would generate strong bearish signal for deeper correction of Dec/Apr $67.70/$87.61 rally and expose targets at $77.86/66 (100DMA / 50% retracement).
Broken 55DMA ($81.33) marks initial resistance, ahead of falling 10DMA ($82.46) and upper breakpoint at $83.99 (20DMA).
Res: 81.33; 82.46; 82.91; 83.99.
Sup: 80.00; 79.27; 78.90; 77.86.
