USOIL Faces another Rejection at $89 as It Embarks on a Fresh Downtrend

Key Resistance Levels: $80.00, $84.00, $88.00
Key Support Levels: $66.00,$62.200,$58.00

USOIL (WTI) Long-term Trend: Bearish
USOIL has fallen significantly as it embarks on a fresh downtrend. Since June, the WTI price has been making a series of lower highs and lower lows. Today, USOIL is making an upward correction but the uptrend is stuck at the 21-day line SMA. The implication is that the selling pressure may resume. On the downside, WTI will further decline when the bears break below the $81 support.

Daily Chart Indicators Reading:
USOIL is at level 46 of the Relative Strength Index for period 14. It is in the downtrend zone and may further decline. The index price bars are below the moving average lines indicating a possible decline. The 21-day SMA and the 50 –day SMA are sloping southward indicating the downtrend.

USOIL (WTI) Medium-term bias: Bearish
On the 4 charts, the index is in a downtrend as it declines to the low of $81. The bulls bought the dips as the index corrected upward. The price breaks above the moving average lines but faces rejection at the recent high. Meanwhile, on the September 1 downtrend, a retraced candle body tested the 78.6% Fibonacci retracement level. The retracement suggests that USOIL will fall to level 1.272 Fibonacci extension or level $82.86.

4-Hour Chart Indicators Reading
WTI is above the 80% range of the daily stochastic. It indicates that the market is in an overbought region. Sellers will emerge in the overbought region to push prices down. The 21-day line SMA and the 50-day SMA are sloping downward indicating the downtrend.

General Outlook for USOIL (WTI)
USOIL (WTI) is in a downward move as it embarks on a fresh downtrend. The selling pressure will resume if price breaks below the current support.


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