Momentum Shifts Toward Deeper Declines
Today’s action carved out another lower swing high, signaling potential acceleration in bearish momentum as the descent steepens. A break below the recent trend low of $60.64 would confirm the bearish trend’s continuation, opening the door to the next key target at $58.39—the 88.6% Fibonacci retracement of the rally from May’s swing low. This level marks a critical support zone, where buyers might attempt a stand.
The decisive breach of the 20-day average on September 29, followed by its rejection as resistance yesterday, underscores bearish control. This flip from support to resistance is classic bearish behavior, though a daily close below $61.50 is needed to cement the thesis.
Weekly Chart Reinforces Bearish Outlook
The weekly chart echoes the daily’s pessimism. This week’s high met resistance near the 10-week moving average, mirroring the daily’s 20-day line rejection. Last week’s wide-range bearish candle closed below an eight-week consolidation range, confirming a breakdown. Support briefly held at the 78.6% Fibonacci retracement, but yesterday’s lower swing high and this week’s likely inverted hammer candle—with a close near the weekly range’s lows—point to sustained selling pressure. These patterns suggest crude oil is poised for further weakness unless buyers can muster a defense.
Risks and Key Levels Ahead
The bearish scenario hinges on continued selling, with $60.64 as the immediate downside trigger and $58.39 in sight. However, a decisive rally above this week’s high of $63.09 would challenge the bearish setup, potentially signaling a reversal. For now, the 20-day average remains a formidable barrier. Watch Friday’s close for confirmation of the trend’s direction—bears hold the edge, but bulls aren’t out of the fight yet.
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