WTI OIL extends steep fall after OPEC+ decision to further increase output

WTI oil extends steep fall into third consecutive day to almost fully retrace last week’s $64.99/$70.50 rally.

Oil came under pressure after repeated upside failure at $70 zone (psychological / daily Ichimoku cloud top), with latest decision of OPEC+ to further boost production by 547K bpd in September adding pressure and so far offsetting support from concerns about impact from US tariffs on export from a number of their trading partners and threats of a massive sanctions on Russia and countries that buy Russian crude oil.

Absence of expected reaction from largest Russian oil buyers (China and India) who signaled that they will not comply with Trump’s demands, left fresh bears fully in play for now and threatening of further weakness.

Today’s acceleration broke below thick daily cloud (spanning between $66.64 and $69.89) generated fresh bearish signal (to be confirmed on daily close below cloud base) and exposed key near-term supports at $65.00/64.70 100DMA / higher base, formed in the last week of July.

Weakened daily studies (break below the cloud and below 200/10/20 DMA’s / 14d momentum entered negative territory / south-heading RSI slid below neutrality zone) support scenario, with daily cloud base ($66.64) to ideally cap upticks and guard converged daily Kijun /Tenkan-sen ($67.49/$67.61) respectively, violation of which would sideline bears.

Res: 66.64; 67.12; 67.61; 67.92
Sup: 65.44; 65.00; 64.70; 63.99