Oil’s Decline Continues

Oil(WTI) continues to display great weakness,on par with macroeconomic developments that signify a prolonged period of reccesion in Europe and continued challenges for the rest of the developed and developing world.Technically it has been almost equally hard as in the case of the scandalously manipulated  stock markets to predict its movements,yet some interesting points can be made in the chart below.

The consecutive breaking of parallel fibo support levels has now set the price at the 85.73$ mark-right at the 61.8% level of the short-term retracement.If this does not hold,then continued downward momentum will bring it in the 82.1-85.7$ price range soon.Any upward movement that fails to break the 88.5-89$ support will be short-lived in our view.Should the downward scenario come to pass,we will likely see the price moving below the middle parallel line of the price channel.It would not be premature to say that then,the main issue will be whether the macro-bullish line,indicated by green on the chart will provide support.We should also note that the RSI index is still above the 30 level,indicating that a further drop is quite probable.

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This entry was posted in Markets.

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