WTI – direction south
WTI has retraced from the highs made in April and has been stabilizing near $61.00 a barrel. News that two Saudi oil tankers were damaged from an attack led to a spike in crude prices towards 63.50, however, price quickly returned to its original level.
Deterioration of Chinese economy is visible and new round of trade wars also adds up to the fears of global slowdown – which eventually leads to lesser consumption. At the same time, US oil production is a strong factors which is also pulling oil down.
Technically, further decline is likely. The 4-hour chart looks bearish and recent spike-and-rejection is also symptomatic. There are two strong downward sloped resistance levels at 61.80 and 63.50 containing bullish attempts and a recent price maximum at 63.50 makes perfect stop-loss placement area.
I will sell if price breaks below 60.70 local support. Further bearish impulse could well bring price towards 58.30 and eventually to 56.00 area.
Sell at current levels with tight stop above 63.50.
Have a nice day !