WTI oil price fell sharply on Wednesday, losing around $18 in early Asian trading, in reaction to decision of a two-week ceasefire between US/Israel and Iran and re-opening of (not entirely closed) Straight of Hormuz that provided relief.
The deal marks the first step toward the long-lasting peace in the region and temporarily neutralized fears of further escalation that would make oil prices skyrocketing and cause a domino-effect on global economy (rising inflation, higher interest rates, slowdown in economic growth would lead into recession).
Although the ceasefire is still fragile, oil prices were significantly lower in immediate reaction that boosted optimism.
Technical picture on daily chart has weakened following the latest sharp drop that formed large bearish daily candle (the biggest daily loss since March 9), with 14-d momentum breaking into negative territory and RSI / Stochastic heading south, contributing to bearish signal developed on break through $100 (psychological) and $98.00 zone (Fibo 38.2% of $63.57/$119.44 / 20DMA).
Bears found temporary footstep at $91.00 zone (after cracking 50% retracement at $91.50) where the action is taking a breather after a massive loss earlier today.
Consolidation is likely to precede fresh push lower (if situation on the ground continues to fuel optimism), with violation of $90 zone to validate negative signal and expose next breakpoint at $84.50 (March 23 higher low), loss of which to complete a double-top pattern on daily chart and further weaken near-term structure.
Daily close below broken $98.10 support would be minimum requirement to keep fresh bears intact and offer better levels to re-enter bearish market, while return and close above $100 would question bears.
Res: 96.50; 98.10; 100.00; 101.93
Sup: 91.09; 90.00; 86.45; 84.50
 Straight of Hormuz that provided relief.){kind=link}