Oil falls back below $30.00/bbl after short-lived recovery

By FXStreet FXStreet (Córdoba) – Crude oil prices started the day on a strong footing, rallying after Chinese data showed a possible record demand of the commodity during 2015. But the recovery was short-lived as the background reasons – oversupplied market – behind the ongoing bearish trend remain firm in place.

The intraday advance was also attributed to some speculative profit taking, given that the commodity has shed around 20% ever since the year started. WTI futures closed at $28.46/bbl, down 3.3%, the lowest settlement since September 2003.

WTI technical perspective

“West Texas Intermediate crude oil futures traded as high as $31.33 a barrel, but quotes now sub 30.00, and the technical picture according to the daily chart, is still strongly bearish, given that the Momentum indicator has resumed its decline in oversold levels, while the RSI indicator failed to overcome its 30 level”, said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the price is now below a bearish 20 SMA, currently the immediate resistance at 30.05, while the technical indicators turned sharply lower around their mid-lines, supporting a new leg south on a break below 29.10, the immediate support.”

Support levels: 29.10 28.50 27.70. Resistance levels: 29.90 …read more

Source:: FX Street