WTI oil futures for March delivery broke below what was thought of as a strong support at the 50-period simple moving average of 64.67 in the 4-hour chart, hinting that further corrections could emerge in the near term. This followed unsuccessful efforts to crawl back to a three-year high of 66.63 reached last week.
The market is building negative momentum in the short-term as the RSI is below 50 and is heading lower, while the MACD is well below its signal line in bearish territory and the Tenkan-sen (red line) crossed below the blue Kijun-sen line.
Immediate support could now be provided by the 78.6% Fibonacci of 63.57 of the upleg from 62.75 to 66.63 and any additional losses from here could next find support at the previous bottom of 62.75.
Alternatively, a move to the upside could find resistance at 64.67, where the 50-period MA and the 50% Fibonacci are located. A substantial close above this level might drive prices back to the 20-period MA of 65.53, opening the way towards the three-year high of 66.63.
