Crude oil dropped to a fresh session low near $90.44 on Sept. 29 after sellers turned back a test of the 200-hour moving average. The US offer to release 40 million barrels from the Strategic Petroleum Reserve and reports of improving Middle East export volumes added to the pressure. Traders are now watching $88.72 as the next line of defense for buyers.
Crude oil fell to new lows for the day after the US offered to release up to 40 million barrels from the Strategic Petroleum Reserve, a move the market read as bearish. Reports of improving export volumes from major Middle Eastern producers added to the pressure.
Sellers defend the 200-hour average
Futures climbed from a low near $85.75 to a high of $107.46 on Sept. 15, then reversed sharply, bottoming near $88.72 on Sept. 22 and 23. Trading has been choppy since, as buyers and sellers search for the next sustained move.
Buyers pushed above the 200-hour moving average for the first time since Sept. 17, but they could not hold the break. Momentum faded before the $97.00–$98.48 swing resistance area, and crude fell into yesterday's close. Today brought another test of the average near $94.74, and sellers again leaned against it, rotating the price lower. Crude last traded near $90.44, after a session low of $90.06.
Downside targets take shape
With sellers defending the 200-hour moving average, the first support level is $88.72, which held on Sept. 22 and 23 and lines up with earlier swing lows. A sustained break below that level would turn attention to the 50% retracement near $86.93, followed by the 100-day moving average near $86.55. A rising trendline runs through that same area. Should those levels give way, the rising 200-day moving average near $81.74 becomes the next target.
For buyers to regain control, the price would need to clear $94.74 and hold above it, putting the $97.00–$98.48 swing area back in focus.
Source: Investinglive RSS Breaking News Feed
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