WTI falls to 11-month low as sentiment sours further
WTI oil price fell 3% and hit the lowest levels since late December 2021, in early Monday’s trading.
The sentiment remains weak and was further soured by Sunday’s protest in Shanghai over China’s strict Covid measures, boosting concerns about further weakening of demand, as China is world’s biggest oil importer.
Investors also focus on upcoming OPEC+ meeting on oil output, due on Dec 4 and the impact of G7 decision to cap price on Russian oil.
Markets fear on lack of signals that oil producers would cut output and contribute to tighter oil market, as well as the US decision to not start reloading its strategic reserves that would add pressure to already bearish oil market and push the price further down.
The WTI contract is on track for a heavy monthly losses in November (around 15% so far) and entered the fourth consecutive week in red.
Last Friday’s and weekly close below Fibo support at $78.48 (76.4% of $62.42/$130.48) generated additional negative signal,, as bearish engulfing pattern is forming on a monthly chart.
Daily techs are in full bearish setup and contribute to negative outlook, as bears pressure immediate target at $72.45 (200MMA), violation of which would risk test of psychological $70 level.
Corrective actions are expected to be limited (unless substantial change in fundamentals) and offer better levels to re-enter firmly bearish market, while capped under $80 barrier (psychological / falling 10DMA).
Res: 76.43; 77.41; 78.48; 80.00
Sup: 73.57; 72.45; 71.62; 70.00