- WTI holds the 200-day simple moving average support.
- Indicators favor extension of Wednesday’s 5.51% decline.
West Texas Intermediate (WTI) crude, the North American oil benchmark, is currently near $37.50, having avoided a bearish close below the 200-day simple moving average (SMA) support on Wednesday.
However, the black gold ended the day with a 5.51% drop, the biggest single-day percentage loss since Sept. 8. The decline has strengthened the bearish view put forward by the 14-day relative strength index’s ascending triangle breakdown confirmed last week.
Further, the MACD histogram is now charting deeper bars below the zero line, indicating a strengthening of the bearish momentum.
As such, a convincing break below the 200-day SMA at $37.30 looks likely. That would shift the focus to deeper support at $36.13 (Sept. 8 low).
On the higher side, a close above the psychological level of $40 is needed to weaken the bearish bias.
Credit: FX Street