WTI Price Analysis: Sees acceptance below $70.00 as US recession fears deepen


  • Oil price is expected to find acceptance below $70.00 as US debt-ceiling issues are escalating.
  • The US Treasury will be out of funds for making obligated payments on the failure of raising the US debt ceiling.
  • A recovery move by the oil price to near $71.75 has retreated as support became resistance for the oil bulls.

West Texas Intermediate (WTI), futures on NYMEX, are showing quite a sideways performance around $70.00 in the Asian session. The oil price is continuously facing selling pressure as a delay in negotiations over the United States borrowing cap limit has deepened fears of a recession in the economy.

The street is worried as if the White House and top Republican leaders fail to reach a decisive action, the US Treasury will be out of funds for making obligated payments on the failure of increasing US debt-ceiling, which will result in a huge loss of production scale and millions of jobs.

Meanwhile, oil prices have failed to capitalize on rising odds of a pause in the policy-tightening spell by the Federal Reserve (Fed). The US Dollar Index (DXY) has refreshed its monthly high above 102.73.

Oil prices witnessed a sell-off after a breakdown of the Ascending Triangle chart pattern formed on an hourly scale. A recovery move by the oil price to near $71.75 has retreated as support became resistance for the oil bulls.

The 50-period Exponential Moving Average (EMA) at $71.13 is acting as a barricade for the oil bulls.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in the bearish range of 20.00-40.00, signaling more weakness ahead.

A further breakdown below May 12 low at $69.94 will expose the asset to May 03 low at $97.92. A slippage below the latter will expose the asset to May 04 low at $63.60.

On the flip side, a solid recovery above May 10 high at $73.80 will allow the asset for further upside towards May 02 high at $76.06. A breach of the latter will expose the asset to April 26 high around $78.00.

WTI hourly chart

WTI US OIL

Overview
Today last price 70.19
Today Daily Change 0.13
Today Daily Change % 0.19
Today daily open 70.06
 
Trends
Daily SMA20 74.64
Daily SMA50 75.14
Daily SMA100 76.58
Daily SMA200 80.49
 
Levels
Previous Daily High 71.77
Previous Daily Low 69.94
Previous Weekly High 73.81
Previous Weekly Low 69.94
Previous Monthly High 83.4
Previous Monthly Low 73.88
Daily Fibonacci 38.2% 70.64
Daily Fibonacci 61.8% 71.07
Daily Pivot Point S1 69.41
Daily Pivot Point S2 68.75
Daily Pivot Point S3 67.57
Daily Pivot Point R1 71.24
Daily Pivot Point R2 72.43
Daily Pivot Point R3 73.08

 

 

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