WTI extends sharp fall on growing demand worries
The WTI oil price extends sharp fall into second straight day, dropping 4.5% on Wednesday, after registering a 4% loss on Tuesday.
Oil was deflated by growing concerns about the state of global economy, as growth weakening is expected to extend, with dark forecasts for 2023, due to slowdown of largest world economies.
Lower demand would lead to oversupply that prompted top oil exporter Saudi Arabia to cut prices of its oil in February, weighing additionally to oil prices.
The US central bank is also in focus as it strongly raised its interest rates in 2022 that has already showed negative impact on economic activity, with further hawkish stance from Fed to add to concerns about global demand.
Technical studies on daily chart weakened significantly and turning into bearish setup, as momentum indicator is in steep fall and broke into negative territory, while moving averages turned to bearish configuration.
Near-term action is additionally weighed by a bull-trap above $80 barrier and a double-top pattern ($81.15/45), as fresh weakness retraced over 61.8% of $70.09/$81.46 recovery leg and turned focus to key supports at $70.09/00 (2022 low / psychological).
Res: 74.43; 75.78; 76.15; 77.12
Sup: 72.77; 72.00; 70.78; 70.00