Down 7%, Crude Oil Trends, MT4.MT5 In-Depth Discussion

Demand outlook is suppressed + supply is expected to increase, WTI crude oil fell more than 7%

 

Concerns about a global economic slowdown or even a recession have led to a plunge in international oil prices. In the U.S. session on Tuesday (July 12), WTI crude oil further expanded its decline and once reached the 96.00 mark, down more than 7%.

 

Taking the United States as an example, although the better-than-expected non-farm payrolls data in June showed that the labor market is still tight, investors are still worried that the Fed's aggressive interest rate hikes will make the economy continue to slow down and even face the risk of recession.

 

The 2-year U.S. bond yield was once again higher than the 10-year bond yield, sparking heated discussions in the market. This yield curve inversion, known as a "nuclear bomb-grade" inversion, is seen as an important warning sign of an impending economic recession. It is worth noting that this is the third time this year that a "nuclear bomb-level" inversion has occurred, which will undoubtedly exacerbate investors' concerns that the U.S. economy is falling into recession.

 

Compared with the United States, the economic situation in Europe is more severe. The Russian-Ukrainian conflict has continued to deteriorate Europe's energy supply prospects, and the already fragile euro zone economy is facing immeasurable losses.

 

The slowdown in growth and even recession in the European and American economies has suppressed the demand outlook for crude oil, which is a major factor dragging down the trend of oil prices. In addition, the supply of crude oil in the market is expected to increase, which will exacerbate the short-term decline in oil prices.

 

The UAE crown prince is expected to meet French President Emmanuel Macron in Paris next week, or to discuss the increase in supplies, it is reported. In addition, US National Security Adviser Sullivan recently pointed out that US President Biden discussed energy security issues with OPEC leaders during his trip to the Middle East. By then, Biden will try to persuade Gulf countries to increase production to lower gasoline prices, and believes that OPEC is capable of taking further steps.

 

There were market expectations that were not conducive to the trend of crude oil in both supply and demand, causing WTI crude oil to plummet again. After falling below the 100 mark, it quickly expanded its downward space, and fell by more than 7 US dollars in the day, or more than 7%.

 

WTI crude oil technical analysis: the second time to test key support, falling below may intensify the sell-off

 

The daily chart of WTI crude oil shows that the price tested 123.66 (point A) on June 14 and fell under pressure, falling below the upward trend line since December 2 last year and finally forming the bearish 123 rule, which means that the market has more Multiple downside risks.

 

Previously, the price rebounded after being supported by the 92.96~95.34 area, but the upside was blocked at the 105.20 line and turned lower again. At present, you can continue to pay attention to the 92.96~95.34 area. Once the market outlook falls below the 92.96 level, it may lead to crazy selling. At that time, the market may fall below the 85 or even 70 mark for support!

 

It is worth noting that the ideal convergence point of the underlying bullish AB=CD pattern at 93.88 falls in the above-mentioned area, strengthening the support in this area.

 

Judging from the current disk, the price may need to reach the 105.00~105.20 area to reverse the disadvantage since mid-June.